American Express Global Business Travel (GBT) will become a public
company through a special purpose acquisition company (SPAC) deal with
Apollo Strategic Growth Capital (APSG).
With plans to trade under the ticker GBTG, the company is expected to have a market capitalisation of US$5.3 billion.
The transaction is expected to provide up to US$1.2 billion of gross
proceeds, of which US$335 million is fully committed from new investors
including Apollo, Sabre, Zoom Video Communications, private equity group
Ares Management Corporation and investment adviser HG Vora.
Upon the closing of the transaction, these companies will become
shareholders of GBT, joining American Express Company, Expedia Group and
“Becoming a public company will be a historic milestone on GBT’s
growth journey. Commitments from new investors like Zoom, Sabre, Apollo,
Ares and HG Vora are a huge vote of confidence in our business and the
future of business travel, and meetings and events,” says Paul Abbott,
CEO of GBT.
“We expect that becoming a listed company will give us the additional
investment capacity to strengthen our commitment to providing
unrivalled value, choice and experiences to our customers and partners.”
According to GBT’s investor presentation, prior to the pandemic, the
company managed US$39 billion in global business travel spending in 2019
— a 40% higher total transaction value than its next closest competitor
that year, BCD Travel.
Revenue in 2019 was US$2.8 billion and adjusted EBITDA was US$502
million. And, thanks in part to US$235 million in cost reductions the
company has implemented since early 2020, it says it can return to that
adjusted EBITDA level if its business returns to just 70% of 2019
GBT says nearly half, 48%, of its revenue comes from companies in the
United States and 26% is from Europe, the Middle East and Africa.
Three-quarters of its revenue comes from travel and 24% from product and
professional services. The company notes that “no single customer or
supplier accounts for greater than 6% of total revenues".
Among its 19,000 customers, GBT says it has 40 companies on BTN’s
Corporate Travel 100 list, five of the 10 largest US banks, five of the
10 largest health care companies and three of the four “Big Four”
The company says it is “positioned for significant growth in the
high-value SME segment,” in part due to its acquisition of Egencia from
Expedia Group, which closed in early November and doubles GBT’s roster
of small- and medium-size enterprises.
GBT estimates total travel spend by SMEs was US$270 billion in 2019
but only 30% of that was “managed” — creating a significant growth
Both GBT and APSG boards of directors have approved the proposed
transaction, which is expected to be completed in the first half of
Upon the closing of the transaction, the combined company will be
renamed Global Business Travel Group, Inc. and will continue to conduct
its day-to-day business under its existing name and brand American
Express Global Business Travel.