The Webjet (ASX: WEB) share price will be on watch today on rumours that it’s a takeover target.
Webjet is a digital travel business spanning both global consumer markets (‘B2C’) and wholesale markets (‘B2B’). It was established in 1998 and now claims to be the leading online travel agency (OTA) in Australia and New Zealand. Webjet says it was the world’s first to use ‘Travel Services Aggregator’ technology and is now leading the industry in blockchain innovation.
Is Webjet A Takeover Target?
This morning there are rumours that Webjet is a takeover target. The Australian Financial Review’s Street Talk is the one that is reporting that Webjet could be a private equity opportunity after Webjet’s share price decline.
The merger & acquisition Goldman Sachs division in Melbourne has supposedly been pitching Webjet to private equity players which may have access to around $2 billion.
The AFR isn’t sure if Goldman is just on a mission for a cut of business, or whether Webjet actually wants this private equity attention. But the reporters speculated it’s being done with Webjet’s approval.
Webjet shares have declined in recent months because large travel business Thomas Cook went bust, which will have a sizeable one-off impact on Webjet in FY20. But aside from that, Webjet is predicting organic EBITDA growth (click here to learn what EBITDA means) could be as much as 23% in the next report.
In an ASX announcement Webjet said that it had seen the speculation about expressions of interest in the company.
It said that its objective is to create value for its shareholders and from time to time it will consider acquisition interest in the business.
Webjet said that if a proposal is received that was “compelling and certain”, the travel company would put it to shareholders. But, “no such proposal exists at present.”