lastminute.com plc, the leading online provider of travel and leisure solutions, today announces the purchase of a specialist leading UK hotel booking agency, First Option Hotel Reservations Ltd (First Option) for £12.1 million.
First Option is a profitable company which was established in 1994. The last published audited accounts of the First Option Group for the year to March 2003 show turnover (defined as commission or management/booking fees) of £7.5 million and profit before tax of £0.7 million. Net liabilities at that date amounted to £0.9 million. First Option is a UK based operation with a staff of approximately 200 people, mainly based at the call centre in Stockport and at the retail outlets throughout the UK.
The consideration will be satisfied by £10.5 million in cash and the issue of 752,353 shares in lastminute.com plc. The consideration shares issued to Sheetal Kapoor, the owner, are the subject of a lock-up period for up to 12 months. Sheetal will remain with the business via a part-time consultancy agreement for a period of 6 months to ensure the integration into lastminute.com is successfully completed.
Application has been made to the UK Listing Authority and the London Stock Exchange for all new shares to be admitted to the Official List and to trading on the London Stock Exchange’s market for listed securities (“Admission”). It is expected that Admission will become effective from 8am on 16 January 2004 and dealings will commence at that time.
Commenting on the transaction, Brent Hoberman, Chief Executive Officer of lastminute.com said: “The acquisition of First Option creates an opportunity for further growth in a category where the margins are good and the returns are sustainable. Hotels is a product category which has seen great adoption by consumers online. The presence at principal UK railway stations and airports will add significantly to the overall reach of lastminute.com and continues the delivery of our mission to make lastminute.com a part of people’s daily lives. This acquisition again accelerates our growth in the UK, our largest market and moves us to a leading position in the online hotels category.”
Sheetal Kapoor, Managing Director and Founder of First Option added: “I am delighted that First Option has been acquired by a parent that will help the business to continue to grow as the synergies of the businesses for both corporate and retail customers are compelling. I look forward to continue working with the Group to assist with the integration process of First Option into lastminute.com. I am sure that First Option will add materially to the overall lastminute.com hotel portfolio.”
Trading in the First Quarter, the seasonally weakest quarter, was strong with TTV by departure basis being ahead of expectations especially in the area of flights. All other financial metrics are broadly in line with expectations taking into account a higher level of TTV.