Rahul Bhatia, a New Delhi-based entrepreneur who owns IndiGo airlines and InterGlobe group, is selling around 35% stake in the group’s travel reservation arm — InterGlobe Technology Quotient (ITQ). Three financial investors — Standard Chartered Private Equity (SCPE), Singapore-based DBS and Credit Suisse — will pay $140 million (Rs 560 crore) for the one-third stake.
Sources close to the development said SCPE would invest around $75 million, DBS $40 million, and Credit Suisse the balance $25 million. The deal, managed by Credit Suisse, is likely to be closed in a week.
Mr Bhatia, CEO of InterGlobe and chairman of IndiGo airlines, was not available for comment. A spokesperson said “SCPE and DBS have already concluded the deal, while discussions are on with other potential investors.”
Headquartered in New Delhi, InterGlobe Enterprises is a diversified international corporation with business interests spanning air transport management, travel distribution and hotels. It also owns the domestic airline — IndiGo, through its aviation company — InterGlobe General Aviation.
The group, having annual revenues of Rs 4,000 crore and net profits of around Rs 200 crore, employs around 5,000 people.
For Mr Bhatia, this is the first fund-raising programme. Sources said he may look at raising funds for his airlines business and the proposed hotel expansion projects. The group, built by him from a network of generalised sales agents (GSAs), enjoys long relationship with their agents and customers, said sources. He also owns a restaurant ‘China Club’ in Gurgaon.
The group currently has a network of 52 offices across 23 cities in India and in the US, the UK and South Africa. The group employs more than 2,000 skilled professionals across its businesses. Sources said InterGlobe’s travel reservation systems business is highly cash-rich and profitable. It has a wide national network through travel agents, who undertake airline and hotel bookings.
InterGlobe Technology Quotient (ITQ) is a strategic business unit of InterGlobe Enterprises, and has a presence in 230 cities across India and employs over 300 professionals.
It has a software development centre at Gurgaon with a dedicated team of technical professionals that comprises software engineers, specialised programmers, expert database administrator, focused technology specialists and designers spanning across applications and frameworks. In 1994, the US-based Galileo International had appointed InterGlobe as its national distribution company in India.
Ever since, Galileo India, part of InterGlobe having a franchisee agreement with the US major, has extended its network to 230 cities with 19 dedicated offices, reaching out to over 7,000 agency locations. The service infrastructure includes 18 service centres providing round-the-clock support and many training centres.
Galileo is one of the fastest-growing travel distribution companies of the world and among the first to launch e-ticketing in India. Owing to a widespread and strong international network, the company delivers the best possible information, access and reach to its travel partners, including the likes of American Express, Thomas Cook, and Kuoni Travel Group.
Source: Economic Times