Leading software company Ebix has been looking to expand its portfolio into the travel space, which is why it has offered to buy Yatra for 336 Mn USD. The deal that they have offered is a cash and stock one, which means that this payment will be split between cold hard cash and stock options. Ebix plans to merge Yatra Online with its Indian subsidiary, EbixCash.
Speaking about this deal, Robin Raina, the Chief Executive of Ebix, said “We believe that Yatra Online’s products and services are complementary to EbixCash’s travel portfolio of Via and Mercury, and a combination of the two companies would lend itself to significant synergies and the creation of India’s largest and most profitable travel services company.”
According to the company, their offer of 7 USD per share gives Yatra an 84% premium, as per the company’s closing price on Friday. This deal will also result in the addition of 25-30 cents per shareholder, which can ultimately be extremely profitable if Yatra accepts it. According to their offer, they have valued the company at a 50% premium as compared to its valuation on Nasdaq during its reverse merger. While Ebix has said that it plans to reduce the total offer if they do not receive any positive indication from the board, they have also said that they may cancel the deal if Yatra does not allow the company to go ahead with due diligence by March 18. This means that the travel start-up needs to make its decision quite soon.
Ebix has been on a bit of an acquisition spree. It has acquired Indian-based ItzCash for 120 million, along with travel firm Via for 72 Million USD. It acquired an 80% stake in February in Zillious Solutions. Apart from this, Ebix also recently acquired Centrum Direct for 175 million USD.