On Monday, American Express made the announcement that they will sell 50% of their Global Business Travel division to an investor group for $900 million. The investor group includes Certares LP, Qatar Holdings, Macquarie Capital and funds managed by BlackRock.
“To our knowledge, this would be the largest single investment made in a travel management company,” said Bill Glenn, who will be CEO of the joint venture, in a statement. “We believe it will accelerate our growth by funding meaningful advances in technology, analytics and service excellence that will benefit suppliers, partners and our global customer base. We account for more corporate travel sales than any other TMC, and these initiatives will put us in a better position to help travel buyers manage travel spend and support their travelers.”
The deal is a final effort of an initiative that American Express started last year to trim their exposure to corporate travel, which is a declining business. Many corporate employees are now making their own arrangements, rather than relying on agencies. The deal will be the largest single investment in a travel management company, according to CNBC. American Express was advised by both Lazard and UBS AG, while the investment group headed by Cetares was advised by Credit Suisse.
The current Global Business Travel customers collectively spend $19 billion on travel. The group has partners in 139 countries and 14,000 employees. The venture will be led by Glenn, former President of Global Commercial Services at American Express. Certares founder Greg O’Hara will serve as chairman.