SOUTHLAKE, Texas and LONDON–(BUSINESS WIRE)–May 12, 2005–Sabre
Inc., a direct subsidiary of Sabre Holdings (NYSE:TSG), and
lastminute.com plc (LMC LN) today announced that they have reached an
agreement for Sabre to acquire lastminute.com. The addition of
lastminute.com, with its well-established consumer brands, is expected
to provide Sabre’s Travelocity unit with greater scale and the leading
position in the growing European online travel marketplace.
The acquisition price of 165 pence per lastminute.com share values
lastminute.com’s Diluted Share Capital at approximately GBP577
million. The terms of the acquisition imply an enterprise value for
lastminute.com of approximately GBP606 million, including gross debt
as at March 31, 2005, of approximately GBP69 million and cash at bank
and in hand as of March 31, 2005, of approximately GBP40 million.
The acquisition will be made by Travelocity Europe Limited, an
indirect subsidiary of Sabre Holdings established for the purpose of
the acquisition. Sabre has obtained committed financing, arranged by
Morgan Stanley and Bear Stearns, which, together with its cash
balances, is sufficient to satisfy in full the cash consideration
payable to lastminute.com shareholders under the terms of the
acquisition.
The proposed acquisition is expected to be neutral, post
integration costs, to Sabre Holdings’ earnings per share in 2005 on an
adjusted basis (dilutive on a GAAP basis) and significantly accretive
on an adjusted basis in 2006 (dilutive on a GAAP basis).
It is intended that the acquisition will be implemented by way of
a scheme of arrangement under section 425 of the Companies Act (UK)
(the “Scheme”). It is expected that the Scheme Document will be mailed
to lastminute.com Shareholders on or before the end of May, 2005 and
that, subject to the satisfaction, or, where relevant, waiver, of all
relevant conditions, the Scheme will become effective and the
acquisition completed by the end of July, 2005.
The acquisition price of 165 pence per lastminute.com share
represents a premium of approximately 57 percent over the closing
middle-market price of 105 pence per lastminute.com share on May 10,
2005, being the last business day prior to the announcement by
lastminute.com confirming it had received an approach which may or may
not result in an offer for the company. The acquisition price also
represents a 47 percent premium over lastminute.com’s average share
price for the 30 days to May 10, 2005.
“The anticipated acquisition of lastminute.com directly supports
Sabre’s strategy of extending our role as a travel retailer focusing
on merchandising content, packages, and growing our international
points of sale, while broadening the products and services we offer to
all customers through our travel distribution platform,” said Sam
Gilliland, chairman, president and CEO of Sabre Holdings. “We’re
extremely pleased with the prospect of having lastminute.com, with its
highly-regarded brands and well-established customer base, as a part
of Travelocity, including Travelocity Europe. We expect this
combination would provide us greater opportunity to profit from the
fast-growing European online segment. We look forward to working with
lastminute.com’s strong team to create further value for our
suppliers, our customers and our shareholders.”
Following completion of the acquisition it is intended that Brent
Hoberman, currently CEO of lastminute.com, will become CEO of the
combined lastminute.com and Travelocity European operations, reporting
to Michelle Peluso, president and CEO of Travelocity. Damon Tassone,
currently president of Travelocity Europe, will become Deputy CEO
reporting to Brent Hoberman. Other key lastminute.com and Travelocity
management are expected to continue as senior executives within the
combined organization.
“Today’s offer from Sabre is an endorsement of the achievements of
everyone at lastminute.com. Over the past seven years, we have built a
business from scratch into one of Europe’s leading travel and leisure
groups, with over seven million customers and total transactions worth
GBP992 million for the financial year ended September 30, 2004,” said
Brent Hoberman, CEO of lastminute.com, which also announced its first
half 2005 results today. “Today’s interim results are a further
demonstration that the growth and entrepreneurship at the heart of
lastminute.com is continuing strongly, with total transaction value of
57 percent for the first half of 2005 and a doubling of our order book
since the first quarter of 2005. I am looking forward to the
opportunity of running the combined lastminute.com and Travelocity
businesses in Europe.”
According to Brian Collie, Chairman of lastminute.com, “The
lastminute.com Directors considered this offer from Sabre very
carefully. While we all acknowledge lastminute.com’s future prospects,
we believe that this offer represents an excellent opportunity to
deliver significant, certain value to shareholders now and to build an
even stronger business for the future.”
“This acquisition would bring together two well-regarded brands
and two great teams to create the leading position in European online
travel,” said Michelle Peluso, president and CEO of Travelocity.
“Together we would have strong positions in the UK, France, Germany,
Italy, Scandinavia and Spain. lastminute.com’s diverse mix of flights,
holidays, hotels, car hire, and non-travel, ties closely with
Travelocity’s strategy of continuing to expand our range of offerings
to consumers, beyond basic air travel.”
Europe is the world’s largest leisure travel marketplace. In 2004,
online penetration reached nine percent, but it is expected to more
than double to 20 percent by the end of 2006.
After closing of the acquisition, Travelocity will evaluate its
brands country-by-country with the intention of positioning
lastminute.com as the lead brand in most countries in which it
operates. Travelocity would likely operate multiple brands in Europe
to maintain the broadest possible online presence.
Sabre has identified a number of areas for cost savings and
revenue synergies to Travelocity. Areas of opportunity include
streamlining marketing spending across brands, centralizing operations
and administrative functions, consolidating platforms, and sharing
technologies and supplier relationships.
Approval of the acquisition will be sought from lastminute.com
Shareholders at a court meeting and an extraordinary general meeting
(EGM). In order to become effective, the Scheme must be approved by a
majority in number representing three-fourths in value of the
lastminute.com Shares that are voted at the Court meeting. In
addition, special resolutions implementing the Scheme, sanctioning the
related reduction of capital and approving the alteration of
lastminute.com’s articles of association must be passed by
lastminute.com Shareholders representing 75 percent of the votes cast
at the EGM. Implementation of the Scheme will also require the
sanction of the Scheme by the Court.
The lastminute.com Board, which has been advised by Merrill Lynch
and UBS, considers the terms of the acquisition to be fair and
reasonable. In providing advice to the lastminute.com Board, Merrill
Lynch and UBS have taken account of the commercial assessments of the
lastminute.com Board. The lastminute.com Board intends unanimously to
recommend that lastminute.com Shareholders vote in favor of the
resolutions to be proposed at the Court Meeting and the Extraordinary
General Meeting (EGM), as they have irrevocably undertaken to do in
respect of their own beneficial holdings of lastminute.com shares
(representing, in aggregate taken together with the holdings of their
related trusts and close family members, approximately 7.2 percent of
the existing issued share capital of lastminute.com).
“Diluted Share Capital”
This means the total number of issued shares of lastminute.com
plus the number of shares underlying options of lastminute.com which
have exercise prices of 165 pence which The acquisition value of
GBP577 million for the Diluted Share Capital has been calculated as
follows: 165 pence multiplied by the total number of lastminute.com
shares in issue plus the number of lastminute.com shares underlying
options with exercise prices of 165 pence or less minus the weighted
average exercise price of such options multiplied by the number of
those options.
Notice of Webcast
Sabre Holdings plans to hold a Webcast at 9:00 am EDT to discuss
the announcement, but there will be no Q&A. To access the Webcast,
please log on to the following address:
www.sabre-holdings.com/investor/
About lastminute.com
lastminute.com, Europe’s leading independent online travel and
leisure group, operates directly in fourteen European countries and
participates in three international joint ventures, providing travel
and leisure inspirations and solutions to customers. At 31 March 2005
lastminute.com had over 10 million subscribers to its weekly
newsletter. The business is based on the idea of matching supply and
demand. lastminute.com offers consumers opportunities to acquire
airline tickets, hotel rooms, holidays (both self packaged and third
party packages), car hire, entertainment tickets, restaurant
reservations and food delivery, speciality services, gifts and
auctions.
Having completed 14 acquisitions in the past three years,
lastminute.com now owns and operates online brands including
holidayautos.com, travelprice.com, degriftour.com, travelselect.com,
travel4less.co.uk, eXhilaration.co.uk, medhotels.com,
first-option.co.uk, gemstonetravel.com, onlinetravel.com and
lastminute.de.
lastminute.com seeks to differentiate itself by packaging and
delivering products and services, such as restaurant reservations,
entertainment tickets and gifts, in convenient, novel and distinctive
ways. The company has been successful in developing a distinctive and
widely recognised brand, which is intended to communicate spontaneity
and a sense of adventure to a youthful target demographic.
lastminute.com was founded by Brent Hoberman and Martha Lane Fox
in 1998. Brent Hoberman remains as CEO of the company which currently
employs approximately 2,000 people throughout Europe.
For the year ended 30 September 2004, lastminute.com reported
total transaction value (“TTV”), pre-exceptional EBITDA and profit
(loss) before tax of GBP992.3 million, GBP24.1 million and GBP4.3
million, respectively. Pro forma TTV was GBP1,099 million.
Consolidated net assets as at 30 September 2004 were GBP95.2 million,
including cash at bank and in hand of GBP85.9 million.
About Sabre Holdings
Sabre Holdings is a world leader in travel commerce, marketing
travel products and providing distribution and technology solutions
for the travel industry. Sabre Holdings operates in multiple travel
distribution channels: the travel agency channel, the consumer-direct
channel and the business-direct channel. Through the Sabre(R) global
distribution system, subscribers can access information about, and can
book reservations for, among other things, airline trips, hotel stays,
car rentals, cruises and tour packages. The Sabre Travel Network(TM)
business operates the global distribution system and markets and
distributes travel-related products and services through the travel
agency channel. Sabre Holdings’ engages in consumer-direct and
business-direct travel marketing and distribution through its
Travelocity(R) business (see below). In addition, the Sabre Airline
Solutions(TM) business is a leading provider of technology and
services, including development and consulting services, to airlines
and other travel providers.
About Travelocity
With millions of registered users and booking $4.9 billion of
travel in 2004, the Travelocity segment markets and distributes
travel-related products and services directly to individuals,
including leisure travelers and business travelers, through
Travelocity websites and contact centers, and websites owned by its
supplier and distribution partners. Travelocity customers can access
offerings, pricing and information about airlines, hotels, car rental
companies, cruise lines, vacation and last-minute travel packages and
other travel-related services. For business travelers, the Travelocity
Business(SM) online corporate travel agency provides the integrated
online corporate travel technology and full-service offering of our
GetThere(R) product along with the online expertise of Travelocity.
Cautionary Notice
Statements in this disclosure which are not purely historical
facts or which necessarily depend upon future events, including
statements about the anticipated benefits of the proposed transaction
to Sabre Holdings Corporation (including the expected synergies or the
forecasted effects of the transaction on the financial performance of
the company) or other statements about anticipations, beliefs,
expectations, hopes, intentions or strategies for the future, may be
forward-looking statements within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended. Readers are cautioned not
to place undue reliance on forward-looking statements. All
forward-looking statements are based upon information available to
Sabre Holdings Corporation on the date this report was submitted.
Sabre Holdings Corporation undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. Any forward-looking
statements involve risks and uncertainties that could cause actual
events or results to differ materially from the events or results
described in the forward-looking statements, including risks or
uncertainties inherent in the Scheme of Arrangement procedure, in the
integration of the acquired business (such as ensuring the
effectiveness of the design and operation of the internal and
disclosure controls of the business to be acquired), in securing
long-term financing for the proposed transaction, or in competition
within the European marketplace from established or emerging
competitors. Sabre Holdings Corporation may not succeed in addressing
these and other risks. Further information regarding factors that
could affect our financial and other results can be found in the risk
factors section of Sabre Holdings Corporation’s most recent filing on
Form 10-Q with the Securities and Exchange Commission.
CONTACT: Sabre Holdings
Media Relations:
Michael Berman, 682-605-2397
michael.berman@sabre-holdings.com
or
Investor Relations:
Karen Fugate, 682-605-2343
karen.fugate@sabre-holdings.com
SOURCE: Sabre Holdings