CTM Acquires Majority Stake in Hong Kong's Lotus Travel Group

Corporate Travel Management has acquired a majority stake in Hong Kong-based Lotus Travel Group in a deal worth AUD50 million (HKD300 million).

The purchase of 75.1% of Lotus will take effect from 2 October 2018 and will result in CTM becoming one of the largest travel management companies in Hong Kong servicing Greater China, with a combined Total Transaction Value approaching AUD2.5 billion (HKD15 billion).

CTM’s partners in Asia, Ever Prestige Investments Limited (EPI), will acquire the remaining 24.9% through CTM Asia.

CTM Managing Director Jamie Pherous (pictured) said the two firms had a great understanding of each other’s culture and leadership teams, which would allow for a seamless integration process.

“Lotus is a long standing and highly regarded travel leader in Hong Kong,” he said. “They meet our strict acquisition criteria and, like CTM Asia, are leaders in travel in the region and enjoy high client and staff retention. We are delighted to have Lotus become a key part of our Asian business. Together, we will become a leader in the Greater China market and will be well positioned to enhance our client offering, technology and expertise in this market.”

Having operated for more than 60 years, Lotus is a market leader in Hong Kong across the corporate, B2B, wholesale and MICE markets. It employs 400 staff and has offices in Hong Kong and Greater China.

Chairman and CEO of Lotus, Patrick Kong, said, “We have known the CTM Asia leadership team for many years and have watched CTM Asia build a very strong growth business based on highly personalised service delivery with best-in-class technology solutions. We consider that CTM is an excellent fit to enhance our service offering to both current and future clients, while providing exciting new career opportunities for our employees that comes through growth.”

The acquisition will contribute approximately AUD4 million (HKD24m) earnings before interest, tax, depreciation and amortisation (EBITDA) over nine months trading to CTM’s 2019 annual results.

Mr Pherous said that CTM is expected to deliver FY18 results at or slightly above the top end of the previous guidance, at approximately AUD125m (27% growth on p.c.p).

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