Kuoni suitor tipped for £800m Hotelbeds deal

The prospective new owner of the Swiss Kuoni Group is being tipped as the favourite to acquire Hotelbeds from Tui Group for £800 million.

Swedish based venture capital firm EQT Partners, which agreed a believed £850 million takeover of Kuoni last week, has drawn up plans to merge it with Tui’s Hotelbeds arm, the Sunday Times reported City sources as saying.

Tui, owner of the Thomson and First Choice holiday brands, put Hotelbeds up for sale last year.

The Majorca-based B2B bedbank unit offers rooms to travel agents, with a database of more than 72,000 hotels in more than 100 countries. It recorded earnings before interest and tax of almost £90 million in the year to September.

Tui, listed in London and Frankfurt, hired advisers at Deutsche Bank and Bank of America Merrill Lynch to sell the subsidiary last year.

Insiders said bankers had been waiting to see the outcome of the bidding war for Kuoni before starting their auction. EQT’s swoop on Kuoni has put it at the front of the queue to buy the Tui division, bankers said.

EQT, known in the UK for owning catering company SSP, agreed terms with Kuoni after fighting off rivals Permira and Cinven. If the deal is signed, the 110-year old company will be delisted from the Zurich stock exchange.

Hotelbeds is likely to be worth at least €1 billion. However, Tui will invite bids from other companies in the hope of driving up the price, the newspaper reported insiders as saying.

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