Kuoni acquires Holding in Chinese Travel Company

The Kuoni Group has acquired an equity holding of about 32% in Et-china.com International Holdings Limited (Et-china). The holding was previously owned by Gandhara Master Fund Ltd.

The acquisition makes Kuoni the biggest single shareholder in this important Southern Chinese travel corporation.

Et-china is one of South China's best-known tour operators through its GZL subsidiary, and also provides a leading internet platform in China for individual travel arrangements.

The acquisition is a major step in Kuoni's endeavours to substantially expand its activities in the fast-growing Chinese travel market.

Founded in Guangzhou in 2000, Et-china today owns a majority stake in Guangzhou International Travel Services (GZL), which specialises in group inclusive-tour arrangements both within China and to destinations abroad.

GZL is one of South China's best-known travel brands, and also holds a licence to offer foreign travel products.

Et-china also operates a leading internet platform in China for air tickets, hotel reservations and rental car arrangements for individual travellers. And the company further maintains a joint venture established in 2003 with China Southern Airlines, one of the country's biggest air carriers, under which it is the sole distributor of the airline's e-tickets.

With some 160 travel agencies, its call centre and its well-known internet portal, Et-china is well positioned within the Chinese travel market. The company has a customer base of about 1.5 million, and has been listed on London's AIM stock exchange since August 2007. Et-china generated total turnover for 2007 of about CHF 200 million, and currently has around 1 400 employees.

Kuoni has acquired the holding of about 32% of Et-china from Gandhara Master Funds Ltd., which was the company's biggest single shareholder. The purchase price for the acquisitions of the equity holding amounts to GBP 5.3 million (around CHF 9.2 million).

Kuoni will also assume a seat on the Et-china board of directors. In accordance with the company's articles of incorporation, the Et-china board has approved Kuoni's acquisition of this stake of over 30% without the need to make an offer to acquire the company in full. The new equity holding will be assigned to Division Style within the Kuoni Group.

"In acquiring its holding in Et-china, Kuoni is embarking on a key long-term strategic partnership with one of China's most important travel corporations," said Peter Rothwell, CEO of the Kuoni Group. "This expansion of our activities in China is one of the biggest milestones to date in the more than 100 years of Kuoni's company history."

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