Travel Management Companies are on a Shopping Spree These Days
American Express Global Business Travel, the largest travel management company in the world, said it plans to acquire Germany’s DER Business Travel, the corporate arm of the DER Touristik Group.
With the acquisition, American Express Global Business Travel (GBT) will grow its presence in Germany. Frankfurt-based DER Business Travel has 42 locations across Germany with about 600 employees. Pending anti-trust approvals, GBT will pick up DER Business Travel’s small to medium-sized market.
The deal is expected to be completed in the third quarter of the year. DER will benefit by having access to GBT’s international clients.
This follows GBT’s acquisition last year of the U.K.-based travel management company Hogg Robinson Group, further expanding GBT’s footprint in Europe.
GBT has also entered into various partnerships. Last year, it partnered with Lola, the travel management company run by Paul English, co-founder of Kayak. The revenue-sharing agreement has allowed Lola to move into the corporate travel market.
Other companies have adopted the same strategy of growing by purchasing stakes or majority ownerships in smaller entities that operate in markets they want to break into.
BCD Travel last week signed an agreement to take a majority ownership of Hitachi Travel Bureau, one of Japan’s leading travel management companies.
“This investment is the result of careful, long-term planning and also a reflection of our commitment to Asia Pacific,” said Greg O’Neil, BCD’s president of Asia Pacific.
Hitachi Travel Bureau has 280 employees, offices in Japan and China and annual sales of more than $330 million.
This is the latest in BCD’s expansion moves. The company has taken majority stakes or full ownership in companies in the U.S., the United Kingdom, Brazil, China, Hong Kong, Poland, and Colombia.
“Our majority ownership of Japan demonstrates our aggressive acquisition strategy,” said John Snyder, president and CEO of BCD Travel. “We’re growing in markets where demand for corporate travel services is increasing and where our clients want us to be. This acquisition opens up new business opportunities for us in one of the world’s most unique travel markets.”
Meanwhile, Australia-based Flight Centre Travel Group has purchased a majority stake in 3Mundi, which has 115 employees at its offices in Paris, Geneva and Barcelona.
Flight Centre Travel Group has recently acquired corporate businesses in Denmark, Finland, Germany, Norway, and Sweden.
The two companies had already formed a partnership but are now more cemented together.
Since partnering, they have won clients such as PriceWaterhouseCoopers and international engineering specialist Fives Group.
“France and Switzerland are important corporate travel hubs for our existing customers and for new multi-national accounts that we are targeting globally,” said Steve Norris, corporate managing director, EMEA, Flight Centre Travel Group. “This investment will strengthen FCM’s foothold in these markets, and supports our strategy of expanding our equity-owned presence in Europe, which already includes the UK, Ireland, Netherlands, Sweden, Finland, Norway and Denmark.”
Expect to see more mergers and acquisitions, a strategy that has worked well for other industries, such as hospitality (Think Marriott, now the largest hotel company in the world after buying Starwood).