Webjet seems to have grabbed a lead in the corporate travel business in the past two years with major deals offshore.
The big push into corporate travel and accommodation – especially online- has helped Webjet’s share price surge 37% in 2019, putting it well ahead of its larger competitor, Flight Centre, whose shares are only up 2.38% so far this year.
The acquisitions and determined drive deeper into servicing the small to medium corporate sector has helped Webjet’s market value surge to more than $2.3 billion – which is 50% of Flight Centre’s $4.37 billion.
Just judging from the interim results from the two companies, while Flight Centre continues to dominate retail travel into and out of and within Australia, Webjet and its online business seems to be getting stronger growth from the corporate and some consumer sectors.
That little bit of background helps explain the song and dance Flight Centre made yesterday about its purchase of 25%) Upside Travel Company, a Washington DC-based, technology-driven business launched in 2017 by Priceline founder Jay Walker.
Flight Centre said the purchase had “strengthened its presence in the global corporate travel sector” and that the deal had helped it “fast-track its growth within the small to medium-sized (SME) corporate sector.”
“Through its investment, FLT will become Upside’s largest individual shareholder and will gain access to a travel technology platform and software development resources that will enhance its already strong SME offering.
“In addition, the parties have entered into a commercial deal covering cooperation on various distribution initiatives that combine FLT’s deep understanding of the corporate travel space with Upside’s powerful technical assets.
“Upside is an emerging corporate travel business with an innovative customer offering that has the potential to disrupt traditional offerings in the SME sector in the future,” FLT managing director Graham Turner said in the statement yesterday.
“By investing in Upside, we are effectively investing in a next-generation corporate online travel agency,” he said.
Flight Centre shares rose 1.7% to $43.94. Webjet shares were down 0.6% at $15.06.
