MARKET MOVEMENT
Seven years of travel management company mergers, acquisitions, exits and launches
The UK's TMC market has long been rich in numbers and diversity – 'overpopulated', even. And over the years there have been spates of mergers and acquisitions as TMCs look to gain market share, add expertise or make opportunistic moves for competitors. Here we chart the key deals in the UK TMC sector since 2016 as M&A activity accelerated, with the Covid pandemic further influencing industry consolidation but also spawning some new entrants.
Wings Travel Management announced the acquisition of Grosvenor Travel Management for an undisclosed sum. Grosvenor at the time managed £60 million in annual travel predominantly for corporates in the oil and gas, security, finance and legal sectors. Founded in South Africa, the acquisition also marked Wings’ move of its global headquarters to London.
Colpitts World Travel, with offices in the UK, US and Canada, was bought by Direct Travel, the US TMC that had grown through a dozen agency acquisitions in just a few years and proclaimed it was “back on the acquisition trail”.
Clarity Travel Management and Portman Travel merged to create what at the time became the seventh largest TMC in the UK, with £400million gross annual sales. The merger, which came a year after Co-operative Travel Management had rebranded as Clarity, was led by CEO Pat McDonagh. The Portman brand was retired a year after the deal.
It was a double deal for acquisition-hungry Gray Dawes Travel, then ranked 29th largest TMC in the UK, which bought both Travel Management Group (TMG) and Cambridge Business Travel (CBT). CEO Suzanne Horner said the deals achieved its goal to propel the business into of the 20 largest TMCs in the UK, trading in excess of £100 million per year.
Australia-based Corporate Travel Management (CTM) expanded its UK footprint with the acquisition of Redfern Travel a year after it moved into Europe through the purchase of Chambers Travel Management. The Redfern deal was expected to take CTM’s consolidated European total transactional value to £500-550 million in the next financial year.
Public sector travel specialist Capita Travel and Events snapped up York-based NYS Corporate, with both organisations having sizeable events divisions. The two were ranked 6th and 30th respectively in 2017 Leading 50 TMCs.
Statesman Travel Group was acquired by US-based Travel and Transport. Statesman, ranked 16th largest TMC in the UK, added £147 million in annual sales and 150 staff to Travel and Transport’s $3.5 billion annual global sales and 1,600-strong workforce.
In one of the year’s smaller TMC deals, EFR Travel Group bought Manchester-based CSR Travel. Established in 1969, CSR specialised in the corporate, luxury leisure, film, TV and entertainment sectors.
Meon Valley Travel purchased Longreach Travel in a deal designed to strengthen the UK’s then 34th largest TMC’s presence in the MICE market. Longreach was founded in 1975.
Mid-market TMCs Direct Travel and ATPI announced a merger which was billed by BTN Europe as “the birth of another global TMC player” and “a new competitor to the mega TMCs”. Both companies had themselves grown through a sequence of acquisitions in their respective US and European markets. The combined operation broke more than $7 billion in annual sales and employed 4,500 people in more than 160 locations. The Direct Travel and ATPI brands continued in their markets with Direct ATPI Group operating as a separate organisation.
Twelve months later and it was another December deal for Gray Dawes Travel as it announced the purchase of Chelsea Travel Management (CTM). It became its fifth acquisition in three years. The TMCs had been named 21st and 28th largest TMCs in the UK respectively in 2017.
It was the big one. American Express Global Business Travel announced its impending acquisition of HRG, with the combined organisation usurping CWT as both the UK and world’s largest travel management company. In the UK, Amex GBT and CWT were ranked third and second-largest respectively with annual sales of £1.12 billion and £865 million.
More mid-market consolidation with Reed & Mackay buying Hillgate Travel, taking global turnover past £600 million. Reed & Mackay had already added Gray’s Travel Management and Frequent Flyer Travel Paris since being bought by private equity firm Inflexion in 2016.
Gray Dawes Travel’s now familiar winter shopping trip saw it acquire Giles Travel, taking annual turnover from £115 million to £150 million. The TMC said its target was £200 million within three years through acquisitions and organic growth.
Its second acquisition in two years saw Hertfordshire-based EFR Travel Group take over Glasgow’s WD Travel. The purchase of the TMC, which specialised in the shipping, oil and gas, bioscience, entertainment and IT sectors, pushed EFR into the UK’s top 40 travel management providers.
Clarity Travel announced the acquisition of Ian Allan Travel for an undisclosed sum. Based in Shepperton and Bristol, Ian Allan Travel was founded in 1964 and specialised in corporate, educational and charity travel. It employed 80 staff at the time of the deal.
The latest deal under ownership of private equity backers Inflexion saw Reed & Mackay acquire the Business Travel Direct (BTD) division of Ickenham Travel. Reed & Mackay chief executive Fred Stratford said: “This continues to be a truly exciting time for our people and our clients. Our focus has always been on strategic growth, built both organically and through acquisition, where there is a natural and strong alignment to our core values.”
Slightly earlier than in previous years, Gray Dawes Travel’s apparently annual acquisition saw it move in on Amber Road which had rebranded from CTI the previous year. The deal drove annual turnover past £200 million and took its headcount to nearly 300. Gray Dawes was placed 16th in 2019’s Leading 50 TMCs.
Ventur, known at the time as Traveleads, announced the formal integration and merger of Sterling by Global Travel Solutions Group following its acquisition the previous year. Founded in 1971, the TMC had an annual turnover of £39 million.
Business Travel by STA became the first corporate travel business to succumb to the Covid pandemic as parent company STA Travel ceased trading. The company had more than 50 leisure travel shops across the UK and also operated the full-service travel management company which specialised in the academic sector. Around 500 UK jobs across the organisation were thought to be affected. “It’s very saddening to see the demise of such a well-regarded leisure and business travel firm, and particularly the impact that will have on its employees and their families,” said Clive Wratten, CEO of the Business Travel Association, of which the TMC had been a member.
Australia’s Corporate Travel Management announced the purchase of Travel & Transport for US$200.4 million. Radius Travel, the global travel agency network purchased in 2018 by Travel and Transport, was included in the deal. The companies' joint 2019 total sales were around US$7.6 billion, according to the TMCs, making the combined entity one of the world's largest TMCs. It was the largest deal in the US business travel industry since the pandemic struck. In the UK market, the TMCs had been named 5th and 15th largest, with the deal expected to see CTM leapfrog BCD Travel into fourth place on the list.
Bristol-based Thornton’s Travel, which handled £4 million in business travel bookings in 2019, ceased trading after 80 years. The company said: "It is with deepest sadness that we announce Thornton’s Travel ceased trading on the 30th September 2020. We were very proud to have reached our 80th anniversary and would not have achieved this without our amazing staff, suppliers and clients." The privately owned company, whose corporate clients spanned the oil and gas, engineering, defence, entertainment and manufacturing sectors, was a member of the Advantage Travel Partnership, Focus Travel Partnership and the Business Travel Association.
UK travel management company arrangeMY, which came 36th in BTN Europe’s 2020 Leading 50 TMCs ranking, acquired the client book of Tewkesbury-based Gloucester Express Business Travel. Gloucester Express ceased trading after the transfer of its clients.
Horncastle Executive Travel became the latest victim of the Covid pandemic’s devastation of the business travel industry. The Newcastle-based company had specialised in the marine and oil and gas sector and had branches in Edinburgh and Norwich. It had been named the UK’s 45th largest TMC earlier in the year with £13.9 million of sales.