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INDIA BUSINESS WORLD - November 16th December 31st 2008
COX AND KINGS INDIA BUYS TEMPO HOLIDAYS
COX and Kings India (CKI) has acquired Tempo Holidays, a specialist leisure travel company based in Australia, which has an office in New Zealand as well. The deal was negotiated through CKI's Australian Special Purpose Vehicle for approximately US$25 million. The acquisition has been funded by internal accruals and offshore debt from Axis Bank.
Tempo Holidays was founded in 1990 by Susan and Gary Hearst in 1990 as Yalla Holidays. It was rebranded in 2001 as Tempo Holidays, and currently offers travel arrangements in over 42 countries.
Speaking on the deal, CKI's Global CEO, Peter Kerkar said, "After seeing the performance of Tempo Holidays, it has reinforced our belief that the Australian market is ready for an upmarket brand such as Cox and Kings. Our products would be widely distributed in Australia and New Zealand." Upon completion of sale, ownership of Tempo Holidays will move to Cox & Kings (Australia), an entity controlled by the Indian company, and will retain the Tempo brand name.
"A well-established player will save the time and resources that would have been necessary to establish a network of the kind operated by Tempo," he said. The Australian outbound travel market is expected to register a cumulative average growth of 5.2% until 2016. In terms of tourism potential, India is the fifth-largest source market for Australia. Around 1,11,600 Indians visited Australia as Earlier this year, CKI dropped its plan to raise Rs 500 crore through an initial public offering of shares as the stock market slumped.
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