Gesco sells Routes to Air Travel

The Great Eastern Shipping Company (Gesco) has sold Routes Travel (formerly P&O Travel) to the New Delhi-based Air Travel Bureau for an undisclosed amount. Air Travel purchased Gesco's entire 63.64 per cent stake in Routes Travel. It also purchased the remaining shareholding from the members of the Sheth family, promoters of Gesco.

Mumbai-based Singhi & Associates acted as the sole advisors to Gesco for the transaction. Although the exact size of the deal was not known, sources close to the development said Air Travel paid less than the target company's turnover for the acquisition.

Routes Travel, a corporate travel service provider, posted a turnover of Rs 113 crore last year. It has offices in Mumbai, Gurgaon and Bangalore.

Gesco had put Routes Travel on the block since it was not a part of the company's core businesses, namely shipping and offshore.

Air Travel Bureau is a travel agency largely involved in the domestic as well as international ticketing business.

Incorporated in 1994 as a joint venture between Gesco and P&O SNC, one of the largest cruise companies in the world, Routes Travel came into the fold of Gesco last year when it scaled up its holding to 63.64 per cent.

Mahesh Singhi, Managing Director, Singhi Advisors said, "The true potential of the business was not explored as GESCO's main focus was on its shipping and offshore businesses and the revenues generated from the travel business were small for a large business conglomerate like Gesco.

"Also the range of services Routes Travel provides included a foreign exchange desk and the large corporate clientele being the main attraction to the buyer, apart from a multi-city presence. This would help the business scale up in the hands of a serious industry player."