Travelport launches $2 bln London IPO

January 19, 2010
Singapore Democrats

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Daisy Ku
Reuters

New York-based travel service company Travelport launched a $2 billion initial public offering (IPO) on Tuesday to cut debt, in a sign that appetite for such large share sales may be picking up.

The deal, which values the company at $3 billion, paves the way for an eventual exit of private equity house Blackstone, after it bought a majority stake in 2006.

Travelport, which does wholesale hotel bookings and other travel services, aims to sell $1.775 billion of new shares to institutional investors in an IPO on the London Stock Exchange.

Separately, the Government of Singapore Investment Corp (GIC) — Singapore’s sovereign wealth fund — has agreed to buy $225 million worth of new shares at the same time as the IPO, agreeing to a lock-up of 180 days.

As a result, GIC will hold 7.19 percent in the group after the capital hike, Travelport said.

Travelport will see its net debt level drop to $2.3 billion after the listing, down from $4.1 billion, Chief Executive Officer Jeff Clarke said in a call with journalists.

Travelport had been pre-marketed in 2008 but never went ahead because of poor market conditions, a source told Reuters in December. The IPO is likely to be part of many similar deals from private equity firms who want to exit acquisitions they made at the height of the credit boom, bankers say.

The group will start its bookbuilding process on Feb. 1, while shares are expected to begin trading on Feb. 12, a person close to the deal said.

Additional shares of up to 15 percent of the offer could be sold in case of an overallotment. The proceeds of the sale would go to Blackstone and other existing shareholders.

UBS is the sole sponsor for the deal, while Credit Suisse, Deutsche Bank are the joint global co-ordinators, with Barclays Capital and Citigroup as joint bookrunners.

http://www.reuters.com/article/idUSLDE60I0D320100119