ST. LOUIS -- Swiss-based Kuoni Travel Holding is entering the U.S.
market with a proposal to buy upscale tour operator Intrav and its
Clipper Cruise Line subsidiary for $115 million.
Barney Ebsworth, Intrav chairman of the board and owner of 75%
of the company's common stock (NASDAQ: TRAV), agreed to the
acquisition, which is expected to be completed by Sept. 30.
Intrav's shareholders have yet to approve the deal, but with
Ebsworth's agreement, the transaction is virtually assured.
The 40-year-old St. Louis-based company, which went public in
December 1996, operates 75 luxury programs, including private tours
on the Concorde and chartered jets.
It owns four Clipper Cruise Line vessels specializing in deluxe
small-ship itineraries in Alaska, Mexico and the Atlantic Coast.
The four Clipper ships hold between 100 to 138 passengers.
Intrav reported sales of $126 million in 1998, an operating
income of $10.3 million and a net income of $6.8 million.
Kuoni, one of Europe's largest travel companies, with annual
sales of $3.5 billion, has no presence in the U.S. market except
for a office in Atlanta selling its European ground services to
U.S. operators.
A spokeswoman for Zurich, Switzerland-based Kuoni said Intrav
will remain headquartered in St. Louis with its current management
in place, including Paul Duynhouwer as president.
Duynhouwer will report to Peter Diethelm, Kuoni executive vice
president in the U.K., who heads up the newly named Kuoni Strategic
Business Unit for the U.K. and North America.
Kuoni, which has made several key acquisitions in European
markets the last two years, typically "lets the company name remain
and lets the company operate locally in its own markets," the
spokeswoman said.
She said there were several reasons for Kuoni's interest in
Intrav: the U.S. firm's upscale travel products fit well with
Kuoni's products, particularly in the U.K.; the acquisition gives
Kuoni the opportunity to own its own cruise ships, and the deal
enables the company to become a player in the rapidly consolidating
U.S. tour operator industry, where Kuoni sees "excellent growth
potential."
"The U.S. compared to the European market is fragmented, and we
believe will become more consolidated in the future," she said.
In addition, the acquisition will enable Kuoni to increase its
purchasing power in destinations and gain the "know how" of a
successful U.S. operator to expand in the U.S., she said.
Kuoni is the second major European-based travel company to
acquire U.S. tour operators during the wave of consolidation
sweeping the U.S. operator industry. U.K.-based Airtours purchased
San Jose, Calif.-based SunTrips and Atlanta-based Vacation Express
in the last two years.