Webjet buys NZ rival Online Republic for NZ$85M

Australian travel booking site Webjet Limited has acquired rival New Zealand company Online Republic for NZ$85 million (AU$80.4 million). The acquisition is said to leverage Webjet’s entry into the online car rental, motorhome and cruise segments.

The purchase price represents the acquisition price of 7x operating earnings based on Online Republic’s 2016 pro-forma results to March 31, 2016. The company generated a total transaction value of NZ$229 million (AU$216 million), revenue of NZ$40 million (AU$37.7 million) and pro-forma EBITDA of NZ$12 million (AU$11.3 million) for the 12-month period.

More than 90 percent of Online Republic bookings were generated outside New Zealand.

Online Republic is a New Zealand-based e-commerce group that specialises in online bookings of rental cars, motorhomes and cruises. Under the deal, Online Republic’s senior management will retain their positions

Its vendors will be issued Webjet shares at AU$6.21 per share, or 22 percent of the purchase price.

Eligible retail shareholders are also allowed to participate in the capital raising of AU$72 million through the Entitlement Offer. They are invited to subscribe to one new Webjet share for every 6.25 existing Webjet shares they hold as of June 8, 7 p.m. Sydney time.

“The acquisition of Online Republic represents a unique opportunity to leverage Webjet’s core capabilities into the attractive online car rental, cruise and motorhome segments,” John Guscic, managing director, said. “Online Republic is highly complementary to Webjet’s existing portfolio, enabling our business to further expand its offering in car rental and cruise and enter the high growth motorhome rental market.”

He continued, “In addition, bringing Online Republic under our broader Webjet banner will provide the opportunity to accelerate growth of the brands globally. We see significant opportunities in applying the benefit of our marketing and branding expertise, together with our scale, to drive market share gains across Online Republic’s respective segments.”