US-based Ebix Inc. said on Wednesday, i.e. 17 July, that it has acquired Gurugram-based online travel portal Yatra Online Inc. for an enterprise value of $337.8 million (around Rs 2,324 crore), in an all-stock transaction. The enterprise value takes into account a company’s debt, working capital and cash on the books. Here are a few important takeaways from the US-based Ebix-Yatra $337.8 million deal:
1. The transaction will create India’s largest and most profitable travel services company. However, Yatra will continue to be independently run and will retain its brand and status in India.
2. Following the completion of the deal, Yatra will become a part of Ebix’s EbixCash travel portfolio alongside Via and Mercury Travels.
3. In their filings with Nasdaq stock exchange, both companies said they have entered into a definitive agreement to structure the deal as a ‘merger’.
4. The transaction is expected to close by the fourth quarter of calendar year 2019.
5. Ebix has offered to pay $4.90 per share of Yatra, a premium of 26% over Yatra’s Tuesday closing price, and 32% over its closing price on 8 March, when Ebix had made its first offer to buy the Indian company.
6. Each ordinary share of Yatra will be entitled to receive 0.005 share of a new class of preferred stock of Ebix. And each of this Ebix convertible preferred stock will, in turn, be convertible into 20 shares of common stock of Ebix.
7. The combined Yatra-Ebix entity will leverage Yatra’s large and loyal existing customer base, comprehensive service offering and multi-channel platform to take advantage of the dynamic and growing multibillion-dollar opportunity in India, the companies said in a joint statement.
8. Ebix also said it is targeting an EbixCash IPO in the second quarter of next year. “The synergies and the cross-selling opportunities can create tremendous economic value for the shareholders, once the IPO is done,” the companies said.
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