Despegar, the parent company of Decolar in Brazil – a travel technology company – announced today that it has entered into a definitive merger agreement to be acquired by Prosus, a leading global technology company, for US$19.50 per share in an all-cash transaction, representing an enterprise value of approximately US$1.7 billion for Despegar.
The transaction price represents a premium of approximately 34% over the volume weighted average price of Despegar's shares for the 90 trading days ending December 20, 2024.
The Despegar Board of Directors approved the Agreement and decided to recommend that Despegar shareholders vote in favor of adopting the Agreement and approving the merger contemplated therein. This approval follows the unanimous recommendation of a transactions committee of the Board of Directors composed exclusively of independent directors, which was formed in connection with the transaction (the "Transactions Committee").
Prosus has a proven track record of creating leading technology companies worldwide. Despegar will benefit from the significant resources, operational expertise, and advanced AI capabilities provided by Prosus.
The transaction highlights Despegar's position as an important market participant, emphasizing its successful commercial execution, consistent leading innovation, and ongoing focus on margin expansion. For over twenty years, Despegar has been a transformative force in the Latin American tourism industry. As part of the Prosus Group, Despegar is ready to accelerate its growth strategy. This strategic change not only increases Despegar's presence in the market but also strengthens its ability to innovate and compete.
Damian Scokin, CEO of Despegar,said: "We are excited about joining the Prosus Group, as this represents a significant step in our mission to expand our market leadership and grow our services in Latin America. This transaction will allow us to leverage Prosus's extensive network of companies and strong balance sheet, accelerating our growth and innovation strategies. The transaction represents a substantial value for Despegar's shareholders and is a testament to the commitment and hard work of our team, as well as an exciting milestone for Despegar. Our customers will benefit from access to more services, enhanced experiences, greater loyalty benefits, and more comprehensive solutions tailored to their needs. Together, we are laying the groundwork for a new era of travel marked by greater connectivity, innovation, and value."
Fabricio Bloisi, CEO of Prosus Group, said: “Despegar adds significantly to our strong ecosystem in Latin America, a market with incredible growth potential. Today’s announcement is about opportunity and growth – on its own, Despegar is a successful company with great fundamentals and a motivated management team; together, both Despegar and Prosus will make it even stronger. Our ambition is to ensure that Despegar benefits from our wider ecosystem so that we can work together to offer the best OTA travel solution in Latin America.”
Transaction Details
According to the terms of the Agreement, a wholly owned subsidiary of Prosus will merge with Despegar, with Despegar continuing as the surviving entity, and each outstanding share will be converted into the right to receive $19.50 in cash per share.The Despegar Series A Preferred Shares in circulation will be canceled and converted into the right to receive payment of the amount owed in accordance with their terms.
The transaction is currently expected to close in the second quarter of 2025, subject to approval by Despegar shareholders, receipt of necessary regulatory clearances and other customary closing conditions.
Certain shareholders of the Company, including the holder of Despegar's Series A Preferred Shares, have entered into voting and support agreements with Prosus, committing to vote in favor of the transaction.
The transaction is not subject to a financing condition. After the transaction is completed, Despegar will become a privately held company, its common shares will be delisted from the New York Stock Exchange, and it will no longer be listed on any public market.
A Goldman Sachs & Co. LLC is acting as the exclusive financial advisor to the Transaction Committee; A&O Shearman is acting as legal counsel to Despegar.
A Morgan Stanley & Co. International PLC acted as the exclusive financial advisor to Prosus in the transaction, and Davis Polk & Wardell LLP served as legal counsel.
