Helloworld Travel Limited (HLO) today announced it had agreed to acquire a 40 per cent stake in Adelaide based retail travel agency business, Phil Hoffmann Travel (PHT).
Founded by Phil Hoffmann in 1990, PHT operates in the retail leisure and corporate travel sectors in South Australia from nine locations with over 150 personnel.
PHT has been an associate member of Helloworld Travel since 2014. Its head office is located in Glenelg with outlets in Nurioopta, Gawler, Hyde Park, Modbury, Norwood, Semaphore, Stirling and Victor Harbour.
The consideration for the acquisition will be funded from HLO’s existing cash reserves.
HLO will be acquiring 40 per cent of the business from Phil Hoffmann together with an option to acquire the remaining 10 per cent of Hoffmann’s shareholding in the next three years while CEO and director Peter Williams will retain his shareholding in the business.
The acquisition will be earnings accretive in FY24 and beyond. The consideration represents an FY23 EBITDA multiple of approximately six times forecast earnings for PHT.
Andrew Burnes AO, CEO and managing director of Helloworld Travel Limited praised the company’s move to investment in PHT.
“They have been one of the most iconic brands in retail and corporate travel for many years and throughout that time have supported Helloworld as part of our Associate network and through our Viva Holidays, Sunlover Holidays, CruiseCo and Ready Rooms wholesale operations,” Burnes said.
“Both Phil Hoffmann and Peter Williams are extraordinary travel professionals and have a vast knowledge of leisure and corporate travel customers in South Australia.
“We have been closely involved with them over many years and are looking forward to an even closer involvement through our stake in the business.”
Phil Hoffmann said that he was delighted to see HLO taking a stake in the business and would continue with his involvement in PHT in the years ahead.
“PHT has been my professional life for the last 33 years and I am delighted to see HLO now partner up with myself and Peter to continue developing the business into the future,” Hoffmann said.
“I see this new formal partnership between Helloworld and Phil Hoffmann Travel as an exciting opportunity for our respected brand, which will ensure both our clients and our fantastic team continue to enjoy the service, creativity and professionalism that they have been used to for over 30 years.”
Earlier this year, Helloworld announced it had agreed to acquire a 34 per cent stake in Oslo based B2C travel business, Australiareiser from its founders. This move, as Burnes said, was to showcase “the functionality of ResWorld to potential customers across continental Europe and the UK and providing access to the system for retailers and wholesalers across these markets.”
The company also upped its profit guidance following a strong third quarter. Helloworld attributed this to the return of cruise, increased demand for international and domestic travel, and the strong return of inbound travellers.
The transaction is expected to settle early July 2023.
