The leading OTA in Latin America, Buenos Aires-based Despegar has announced the acquisition of the Mexican travel agency Best Day this week in a press release. The deal, which has cost $136 million for the Argentinian player is expected to help Despegar increase its revenues by 25%, as well as to boost its operations in Mexico.
“This is a significant milestone in our consolidation strategy that started with the acquisition of Viajes Falabella,” says Damian Scokin, Despegar CEO. “Additionally, this acquisition is a significant landmark given our goal to continue expanding our operations in Mexico, Latin America’s most important tourism market and the seventh most important destination worldwide.”
Best Day attracted the eyes of the leading OTA mainly due to a good performance as disclosed in the press release. With revenues of $140 million in 2019, EBITDA of $8 million, and with 70% of Best Day sales coming from online transactions; their product portfolio ranges from sale of packages, hotels, and other travel products sold directly to consumers through online channels, call centers and at more than 200 kiosks.
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“We have been operating in the market for over 35 years, and the fact that a company like Despegar, the leader in the Latin American travel market, sees in us an opportunity to strengthen their value proposition in the Mexican market, speaks clearly about the capabilities we have built,” says Julian Balbuena, president Best Day board. Currently, around 75% of Best Day’s revenue comes from Mexico, followed by Brazil, Argentina, the US, and Canada.
“Together, Despegar’s unique competitive levers combined with Best Day’s expertise in wholesale hotel offerings and destination services, will further enhance our value proposition. Best Day also has strong partnerships with leading travel vendors. We are acquiring a company with a solid strategic position and a successful track record that provides significant opportunities to strengthen Despegar’s presence in Mexico and to grow its business to customer value proposition,” further stated Despegar CEO.