China’s Ctrip, the world’s second largest online travel company, is increasing its ownership in Indian online travel company MakeMyTrip to 49 per cent, paving an exit for early investor South Africa-based media group Naspers Limited.
The change in MakeMyTrip’s shareholding comes in as Naspers and Ctrip – both existing investors of the travel behemoth – entered into a share exchange transaction agreement, per an announcement. “Naspers will exchange its entire shareholding in MakeMyTrip for newly issued shares of Ctrip and Ctrip will acquire Naspers’ current shareholding in MakeMyTrip,” the statement added.
With the exchange deal, Naspers will now own 5.6 per cent in the Chinese travel major.
The development is significant as it marks yet another exit for Naspers from the burgeoning startup ecosystem in India. Earlier in May 2018, Naspers sold 11.8 per cent stake in Flipkart to Walmart for $2.2 billion.
“We are grateful for the unstinting support Naspers has provided us over the last couple of years. We have worked with Ctrip in the past years and are excited to take this partnership to the next level,” said Deep Kalra, Chairman and Group CEO of MakeMyTrip. “We will leverage this investment to benefit from the tremendous growth potential in travel and tourism between our two countries.”
MakeMyTrip, one of the early online companies focused on the travel sector in India, owns brands such as goibibo and redbus, apart from its flagship MakeMyTrip brand.
According to data available with travel planning and search engine Ixigo, India is poised to become the third-largest online travel market in the world by 2020, thereby registering an annual growth of 10.5-11 per cent. In 2016, India was the ninth biggest travel market in the world.
MakeMyTrip, headquartered in Gurgaon, offers services with respect to air ticketing, hotel and alternative accommodations bookings and holiday planning and packaging. Besides, it also undertakes activities such as rail ticketing, bus ticketing, car hire and caters to ancillary travel requirements such as facilitating access to third-party travel insurance and visa processing.
The company made headlines in 2016 for the merger with smaller rival Ibibo Group. In September 2015, Kalra forayed into alternate accommodation through a new entity under the MakeMyTrip umbrella called Rightstay.