Prosus, the technology giant behind popular food delivery service iFood, announced today its acquisition of Decolar, one of Latin America’s leading online travel agencies, for approximately $1.7 billion. The deal values Decolar at $19.50 per share, reflecting a premium of 33% from its Friday trading price, and aligns with Prosus’s strategic goal of solidifying its presence across the rapidly growing e-commerce and travel sectors.
This acquisition, publicly disclosed on December 23, 2024, will significantly expand Prosus's customer base to over 100 million, enhancing its operations across key regions, including e-commerce, travel, and fintech. The deal has already received the green light from Decolar's board of directors, who have unanimously recommended it to shareholders for approval.
Fabricio Bloisi, CEO of Prosus, described the purchase as a "significant and strategic addition" to its ecosystem. "Decolar is highly profitable, has an attractive market position, and is led by an experienced management team, making it a natural addition to our Latin America presence," he remarked. The acquisition marks Bloisi's first major strategic move since taking the helm as CEO, aiming to leverage synergies with other portfolio companies such as iFood and OLX.
Decolar, also known internationally as Despegar, operates across 19 countries and recorded over $5.3 billion in gross bookings last year. The company generated $706 million in revenue and reported an EBITDA of $116 million. Expectations for 2024 are similarly promising, with forecasts of $760 million in revenue and adjusted EBITDA of $170 million.
CEO Damián Scokin of Decolar emphasized the acquisition's potential benefits for stakeholders, stating, "This transaction delivers significant value for our shareholders and opens new avenues for growth and improved customer experiences. Prosus is the ideal partner to expand our service offerings." This sentiment reflects the anticipation surrounding the integration of Prosus's technological capabilities, especially in artificial intelligence and operational excellence, with Decolar's established market presence.
Significantly, the deal is expected to facilitate enhanced services for Decolar's customer base, who will gain access to improved loyalty benefits and solutions. Prosus’s previous successes with digital platforms provide confidence for achieving optimal growth trajectories through this acquisition.
The travel sector is experiencing major expansion globally, and Latin America's travel market, characterized by rising GDP and online travel opportunities, presents substantial potential for growth. Bloisi expressed optimism about this trend, stating, "We believe we can work with Decolar to take the business to the next level." He noted the importance of capturing synergies with existing operations and resources, aiming for integrated solutions across different sectors.
The acquisition hinges on completing necessary regulatory approvals and shareholder votes, with the finalization projected for the second quarter of 2025. All payment transactions will utilize Prosus's cash resources.
Notably, this transaction has garnered significant interest on the stock market, with Decolar’s share price surging over 30% following the announcement, reflecting investor confidence and the perceived strength of the deal. Morgan Stanley advised Prosus on the transaction, with Goldman Sachs serving as the financial advisor for Decolar.
Overall, this acquisition not only expands Prosus's footprint within Latin America but also showcases its ambition to become a dominant player across multiple sectors including travel, delivery, and financial technologies. By integrating Decolar's operations with its existing platforms, Prosus aims to create comprehensive offerings optimized for their diverse customer base.
The integration of Decolar is seen as part of Prosus's broader strategy to leverage AI and technology to transform its operations, with Bloisi emphasizing the transformative potential of AI within Prosus’s ecosystem. "The exceptional performance we have demonstrated using AI must now be applied across all our markets," he noted, highlighting the ambitious vision set forth by Prosus's leadership.
With the anticipated operational synergies and the rise of travel demand across the region, the acquisition of Decolar could significantly alter the competitive dynamics of the travel sector within Latin America.
