Aussie firm buys Friends Globe

The deal puts a valuation of Rs 68.6 crore. As a part of the deal, Flight Centre also has an option to buy the remaining 49 per cent by 2010. Subsequent to the transaction, the Indian company will be renamed FCm Travel Solutions.

Flight Centre has also decided that the management team of Friends Globe will remain the same in the new venture and will continue to operate the Indian operations.

Announcing the deal, Anthony Grigson, COO of Flight Centre said, "This gives us a footing in Asia-Pacific and a strong presence in one of the world's fastest growing travel markets. With more and more multinationals moving into India, there is increasing demand of business travel managers who can provide both regional and global services. This deal will certainly create value for our shareholders on a global level and will ensure a sustainable growth opportunity."

According to Rahul Nath, chief executive officer of FGTL, "The new company creates a stronger brand portfolio. As a result, FGTL is planning to raise its annual sales growth target from 25-30 per cent to 30-35 per cent. Our aim is not only to improve the top line but also to use this alliance to further enhance our annual earnings growth target. Currently, FGTL has a sales turnover of Rs 370 crore and has strategies in place to achieve Rs 700 crore by end of 2006."

"The International Tourism Association estimates the Indian corporate travel industry is around Rs 6,500 crore, of which FGTL has a 6-7 per cent share," Nath said.