U.S. software company Ebix Inc, on Monday, offered a cash-and-stock deal of $336 million to acquire Indian online travel service provider Yatra Online Inc, a move by software maker to further add to its portfolio of Indian travel companies with a focus on an online segment of travel service market.
Ebix’s offer of $7 per share represent a premium of about 84 percent to closing price of $3.80 Yatra’s share on Friday, which resulted in 15 percent rise of the share on Monday after the news of offer deal made public by the Ebix.
Ebix is an Atlanta-based software firm that develops software for industries like healthcare, insurance, finance; and with the current offer it is intending to merge the Yatra Online in its Indian subsidiary set up of EbixCash, said the company.
Focusing to capture the travelers for their sports, luxury or events related travel activities, EbixCash created a travel division with acquisitions of Delhi-based Leisure Corp and Mumbai-based Mercury Travels last year, and now Yatra Online to be added in it, which will also add up a value of between 25 cents to 30 cents for the stakeholders holding the shares of combined company.
For the whole year of 2018, Yatra generated revenue of $188 million but posted a loss of $62 million for the same period. With the acquisition of Yatra, yearly revenue of about $150 million will be added towards the total revenue of Ebix and with operating margin of more than 30 percent there will be more earnings for the shareholder of Ebix.
Ebix has given a time period of one week to Yatra’s board of directors, and if they does not respond with a positive conclusion then the offer made by Ebix might reduced the offered amount at its own discretion, as said the company on Monday. Ebix also cautioned of withdrawal of the offer if not been allowed to carry on with the due diligence requirements by the given deadline date of March 18.