Prosus's Major Move: Acquiring Despegar for $1.7 Billion

Prosus's Strategic Acquisition of Despegar

Prosus (OTC: PROSF) NV, recognized as a leading global technology investor, has revealed its intention to acquire Despegar (NYSE: DESP), a prominent online travel agency in Latin America, for an impressive sum of $1.7 billion. Under the terms of this agreement, shareholders of Despegar will benefit from a payment of $19.50 per share, which equates to a remarkable 33% premium over the agency's closing price recorded recently.

Expanding Market Reach in Latin America

This strategic acquisition, recently sanctioned by Despegar's board, not only aims to bolster Prosus's customer portfolio but also seeks to enhance its presence in the Latin American market, which is projected to encompass a customer base exceeding 100 million across various sectors such as e-commerce and fintech.

Despegar's Current Standing

Despegar has established a robust omnichannel B2C platform and is actively growing its B2B segment by providing tailored white-label solutions. Operating in over 19 Latin American markets, Despegar has positioned itself as a key player in the travel industry, facilitating more than 9.5 million transactions annually.

CEO Insights on the Acquisition

Fabricio Bloisi, the CEO of Prosus, highlighted the compatibility of Despegar within its ecosystem. He underscored the travel agency's profitability and experienced management team, signifying a compelling rationale behind the acquisition. The integration of Despegar is set to accelerate its growth trajectory by harnessing Prosus's operational expertise as well as its advanced AI capabilities.

Benefits to Stakeholders

Damián Scokin, who helms Despegar, expressed profound confidence in the partnership formed with Prosus. He emphasized that this collaboration will yield numerous benefits for stakeholders through expanded service offerings and significantly improved customer experiences.

Creating Synergies for Growth

Through this acquisition, Prosus aims to catalyze synergies between Despegar and its other regional enterprises such as iFood, a leading food delivery service, and Sympla, which operates as an events platform. This maneuver aligns with Prosus's overarching strategy of integrating various businesses within its ecosystem, a move anticipated to spur growth and innovation significantly.

Transaction Details and Expectations

This remarkable transaction will be funded using existing cash reserves and is subject to standard closing conditions, including the necessary approval from Despegar's shareholders as well as regulatory bodies. Closing is anticipated in the second quarter of the upcoming year.

Advisors Involved

For this significant acquisition, Prosus is being advised by the financial experts at Morgan Stanley & Co. International PLC and legal firm Davis Polk. Meanwhile, Despegar is receiving guidance from Goldman Sachs & Co. LLC and A&O Shearman.

Frequently Asked Questions

What is the amount involved in Prosus's acquisition of Despegar?

Prosus intends to acquire Despegar for $1.7 billion.

What benefits does Despegar bring to Prosus?

Despegar will enhance Prosus's customer base in Latin America and strengthen its position in the travel and e-commerce industries.

Are there any conditions for the acquisition to proceed?

Yes, the acquisition requires shareholder approval from Despegar and must meet regulatory conditions.

When is the anticipated closing date for the transaction?

The deal is expected to close in the second quarter of the upcoming year.

Who are the advisors for this acquisition?

Prosus is advised by Morgan Stanley International and Davis Polk, while Despegar is guided by Goldman Sachs and A&O Shearman.

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