Travelport flotation to net £1.1 billion

Travelport expects to raise £1.1 billion in its floatation on the London stock market with shares offered at an initial price of between £2.10 to £2.90.

The parent of the Galileo and Worldspan GDSs said it will “primarily” use the proceeds of the flotation to reduce its debt.

Travelport announced its intention to float this month on January 19 and said the Government of Singapore is investing $225 million to take a 7.19% stake.

Speaking at the weekend on the US firm’s decision to list on the London market, Jeff Clarke said the GDS businesses were based in Europe and London was the “most global of exchanges”.

He said Travelport was a high revenue, high margin business, enjoying profit margins of 20%-30%, operating in an industry worth £1.6 trillion a year.

Clarke said the group, 70% owned by private investor Blackstone, did not have any of its £2.2 billion debt to pay back until 2013, so the flotation was not being pursued for that reason alone.

Travelport, previously called Travel Distribution Services, had an aborted attempt to float two years ago after buying Worldspan and merging it with Galileo in 2006.

Clarke believed the travel industry in Europe was resilient and will see strong growth again and that air travel will continue to grow globally despite environmental concerns.

Travelport has appointed Credit Suisse Securities (Europe) Limited, Deutsche Bank, UBS Investment Bank, Barclays Bank and Citigroup Global Markets Limited to manage the shares issue.

The share price values Travelport, which has a 48% stake in ebookers parent Orbitz, at between $3.12 billion and $3.5 billion.


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