CONTINENTAL LEADERS

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In a world where Covid has ravaged business travel, the need to be a big player has never seemed more important.

American Express Global Business Travel continues to aim for megascale, with 2021’s acquisition of Egencia pushing it to even greater heights. In its recent presentation to investors outlining its reasons for going public the TMC said that on 2019 levels, the combined group was around 40 per cent larger than its nearest global competitor (BCD Travel) in terms of total transaction value.

Other multinational groups are also banking on bigger being better, with TripActions acquiring Reed & Mackay and TravelPerk buying Click Travel during the year.

Much of the money driving the acquisitions is coming from venture capital. Amex GBT’s deal to go public was funded by more than $800 million in money from Apollo Strategic Growth Capital.

TripActions raised $155 million in January 2021 and a further $275 million in October 2021, with existing key private equity investors in the company providing much of the new funding. Travelperk’s Click acquisition was in part funded by $160 million in new funding that was raised in April 2021.

Spotnana, backed by former Concur CEO Steve Singh, has also been raising money and is already being linked to some of the bigger names in the European market – a European purchase would go a long way to catapult it into the big league.

This venture-funded rush to get scale does not appear to be ending any time soon. TripActions has continued on the acquisition trail into 2022.

This raises the question of what the other big players in the European market will do.

CWT’s bankruptcy and recapitalisation in 2021 had as its focus to eliminate almost a billion dollars of debt and to provide it with $350 million of new equity funding that it will use to invest in the business. The question will be whether CWT uses that money to grow or whether it will now become a more attractive target for others flush with venture capital money.

Capita plc has also made no secret of its plans to sell its Agiito TMC at some point, with late 2022 and early 2023 touted as a potential timeline for a sale. A purchase could quickly add volume to another player wanting to get bigger on the European stage or offer an opening for someone to explode onto the market for the first time.

With business travel spending starting to recover in 2022, being very big looks like a good bet.