Travel-reservations firm Sabre Corp. has entered into a definitive agreement to buy Abacus International.
Though it already has a 35 percent stake in Abacus, a travel-booking firm, the newly announced deal would make Southlake-based Sabre its sole owner.
The transaction is expected to close in the third quarter of 2015, subject to regulatory approvals and other closing conditions.
Abacus, the leading global distribution system in the Asia-Pacific region,
is currently owned by a consortium of 11 Asian airlines along with Sabre.
Sabre is expected to purchase the remaining portion of Abacus for net cash consideration of $411 million.
The deal would combine Sabre’s global capabilities and Abacus’ local-market expertise of the leading Asian-Pacific global distribution system, according to Sabre president and CEO Tom Klein.
“This powerful combination will give customers even more innovation and service options, while allowing Sabre to accelerate growth globally in a very capital-efficient way – and to gain regional synergies in all three of our businesses serving travel agents, airlines and hospitality companies,” Klein said in a news release.
An Abacus executive agreed.
“We now have the opportunity to take the business forward even faster, broadening the scope within the Sabre family and with the support of our shareholder carriers,” said Abacus president and CEO Robert Bailey in a news release.
Abacus serves more than 100,000 travel agents across the Asia-Pacific region’s 59 markets and has both global and uniquely local relationships with airlines and hotels, including the leading portfolio of low-cost content and Chinese airline content.
Separately, the acquisition includes new long-term distribution agreements between Sabre and the 11 airline owners of Abacus.
Abacus would operate as a region of Sabre Travel Network, with Sabre expecting its expanded Asia-Pacific presence to benefit Sabre Airline Solutions and Sabre Hospitality Solutions, which already provide support to 78 airlines and hotels throughout the Asia-Pacific region.
The acquisition, including associated working capital adjustments and cash acquired, is expected to be financed through about $250 million in cash on hand, augmented by incremental net debt of about $160 million, according to a Sabre news release.
Assuming a third quarter closing date, Sabre expects the transaction will increase 2015 revenue by about $120 million.
Looking ahead to 2016, Sabre expects the transaction to boost revenue by more than $300 million, increase adjusted earnings before interest, tax, depreciation and amortization by about $50 million.
More information is available at http://www.sabre.com/newsroom/sabre-to-acquire-abacus-international/#sthash.4XiqXaUa.dpuf