Travelport helps people with their journeys. Through its primary Global Distribution Systems (GDS) division, it operates electronic reservation platforms Worldspan and Galileo and travel agency service provider THOR. GDS connects travel agencies, websites, and corporations with travel suppliers worldwide. Air carriers are served by Travelport Airline IT Solutions, which offers high-tech business tools and services. The travel conglomerate serves travel agencies and corporate travel departments, owning about 37% of Orbitz Worldwide. Hedge fund Angelo Gordon & Co. owns a 22% stake, followed by Q Investments (14%) and The Blackstone Group (13%). Travelport filed in 2014 to go public.
Travelport would like to raise some $100 million by going public, but ultimately it's aiming high for a $500 million Wall Street debut. The travel conglomerate plans to use the proceeds from the IPO to reduce its debt, which as of March 31 Travelport reported was $3.5 billion.
Following a comprehensive refinancing plan undertaken in 2013, The Blackstone Group's majority stake in Travelport was reduced to 41%. Other investors in the company include One Equity Partners and Technology Crossover Ventures.
Atlanta-based Travelport has sales, service, and support offices in more than 40 countries and the scope of its business extends to more than 170 countries across The America, the Asia-Pacific Region, Europe, the Middle East, and Africa. The US is the company's single largest market, home to more than 35% of its annual revenue.
Transaction processing its Travelport's largest source of revenue, accounting for more than 90% in 2013. The company's Airline IT Solutions unit brings in the rest. Travelport is a partner in eNett, a leading provider of payment services for the travel industry.
Privately-owned Travelport reported sales of nearly $2.1 billion in 2013, a 4% increase versus the prior year. The gain was due to rising transactionprocessing revenue, offset by a decline in Airline IT solutions revenue. The company posted a net loss of $193 million from continuing operations in 2013.
Blackstone, which reduced its majority stake in Travelport to 41% in 2013, has used its financial clout to help Travelport expand its operations and made it easier for the company to act on investment opportunities. The business is looking to emerging markets, including Africa, the Middle East, Eastern Europe, and the Asia/Pacific regions, for growth, opening new offices and beefing up distributor relationships and agreements in those areas. To this end, in 2013 Travelport opened of a new distributor operation in Tunisia, extending its reach it Africa where its GDS operates in 47 countries. Travelport also added a new location in Vladivostok, Russia, adding to its operations in Moscow and St. Peterburgh. Russia, with its growing demand for travel, is a key growth market for the firm.
To fund its expansion and pay down billions in debt Travelport and its private equity owners have looked to the public market. Indeed, Travelport considered floating about $1.7 billion in shares on the London Stock Exchange, but pulled back from the IPO in 2010 because of weak investor interest and volatile markets. (Travelport is no stranger to using IPOs for debt repayment -- the company raised cash for just that purpose in 2007 with an IPO of a minority stake in Orbitz.) In 2012 the company said going public is still an option as Blackstone may be looking to exit its 2006 investment.
Mergers, Acquisitions, and Divestments
Travelport exited its Gullivers Travel Associates (GTA) unit that focused on lodging and ground travel services via the GTA, OctopusTravel.com, TravelCube, and TravelBound brands. When Travelport sold off GTA to Kuoni Holding AG for about $705 million in 2011, the company shifted its focus to its core GDS business.