Statesman Travel Group is to acquire rival travel management company Commodore Corporate Travel for an undisclosed sum, according to reports.
Statesman, owned by industry veterans Mervyn Williamson and Jon Langley, is using a £4.25 million investment from the Business Growth Fund and debt from Lloyds Bank to fund the deal.
Williamson and Langley, former owners of the Phoenix Travel Group, acquired Statesman in 2007. The growth capital fund is taking a “significant minority stake” and a seat on the management board, the Daily Telegraph reported.
Fund chief executive Stephen Welton – former chairman and chief executive of TV Travel Shop – said it had been introduced to Statesman by Lloyds, which also finances Commodore through its Bank of Scotland subsidiary.
He added that Statesman has grown sales significantly despite the tough corporate travel market, with gross turnover rising from £29.7 million to £50 million in the past year.
Net revenues of £1.8 million in the year to March 2011 generated a pre-tax profit of £537,000, according to its latest published accounts. Commodore, which has Lord Montagu of Beaulieu among its directors – generated £45 million of gross sales last year and made a £557,000 pre-tax profit.
The £2.5 million growth fund, funded by Royal Bank of Scotland, Barclays, HSBC and Lloyds Banking Group, expects to make up to 40 investments a year.
Video: Business Growth Fund on investing in Statesman