has signed an agreement to form a joint venture with China CYTS Tours Holding Co., Ltd (CYTS). Financial terms of the transaction were not disclosed. The joint venture, whose corporate name will be CYTS-Cendant Travel Service Co. LTD, aims to creating an unrivalled electronic travel services company that provides China’s growing leisure and business traveler market with a full range of products and services at competitive prices, including hotel, air and packages for inbound, outbound and intra-China travel. Cendant TDS will maintain a 40 percent interest in the joint venture, with the ability to increase that share in the future.
“This joint venture with CYTS, one of the innovators in the China-based travel market, gives Cendant the opportunity to become a key player in China’s growing travel industry,” said Sam Katz, chairman and chief executive officer of Cendant’s Travel Distribution Services Division. “This strategic partnership allows us to accelerate our online international expansion in a market with vast, and virtually untapped, potential.”
The specially negotiated hotel agreements and net rate inventory that make up a key part of this joint venture will complement TDS’ current offering within China, as well as the wider Asia-Pacific region. TDS’ SHTJ subsidiary has important hotel relationships with more than 1,500 properties, primarily in China, and as such is an ideal complement to Cendant’s recently acquired international online hotel booking brands, HotelClub.com and RatesToGo.com.
SHTJ’s technology allows users to complete a booking in either English or Chinese, while viewing room rates in the applicable currency. Additionally, the Cendant-owned company has a complete operating staff in China including call center, sales and marketing and hotel contracting professionals that have a critical understanding of the Chinese market place.
“As our economy in China grows, we are seeing a proliferation of individuals traveling and wanting to make their own arrangements, whether for leisure or for business purposes,” said CYTS Chief Executive Officer, Jiang Jianning. “This joint venture with Cendant TDS enables us to more meaningfully target what we refer to as the frequent independent traveler (FIT) market through the burgeoning online channel in China, by building a reliable and trustworthy distribution option for our consumers.” In addition to the joint venture, CYTS will continue to target traditional tours for groups and individuals, as this remains a strong market opportunity in China and a vital component of the agency’s overall operations.
Dan Wacksman, director of strategic development, Cendant TDS, has been named as general manager of the joint venture and will be based in Beijing. He will be supported by other Cendant TDS executives both in China and other parts of the Asia-Pacific region.
This joint venture is subject to customary regulatory approvals and is expected to be complete within four to eight weeks.