India’s leading online travel company, MakeMyTrip Limited (NASDAQ: MMYT), announced an agreement under which Ctrip.com (NASDAQ: CTRP), a leading travel service provider of accommodation reservation, transportation ticketing, packaged tours and corporate travel management in China, has agreed to make an investment in MakeMyTrip.
Upon completion of the transaction, Ctrip will invest US$180 million in MakeMyTrip through convertible bonds. In addition, MakeMyTrip has granted permission to the chinese company to acquire MakeMyTrip shares in the open market, so that combined with shares convertible under the convertible bonds.
Ctrip may beneficially own up to 26.6% of MakeMyTrip’s outstanding shares. Also it will acquire the rights to appoint a director to the MakeMyTrip board of directors.
The Company will focus on further strengthening its leading market share in the Indian online travel market by offering customers the best mobile booking experience across its full service travel products platform, especially as rising smart-phone penetration is driving an inflection point in India’s online travel opportunity.
Deep Kalra, Founder and Group CEO, MakeMyTrip said “We are delighted to have Ctrip invest in us. Ctrip is the dominant market leader in the online travel market in China. We believe there are many similarities in the Indian and Chinese online travel markets and we expect this strategic relationship between two market leaders to be mutually beneficial.”
Ctrip CEO and Co-Founder, James Liang commented, “Today’s announcement marks the beginning of the strategic relationship between two compnies. Through this transaction, Ctrip has now gained exposure to India’s fast growing online travel market.”
Morgan Stanley acted as the exclusive financial advisor to MakeMyTrip while Latham & Watkins LLP served as the legal advisor to Ctrip on this transaction.