Sunhotels, the European bedbank of Australia's Webjet, is taking a big chunk of UK tour operator Thomas Cook's hotel contracting and supply business.
In a statement it said that it is paying Thomas Cook £21 million ($27.5 million) for "a long-term contract." Other details shared with analysts are that it will get a management fee from Thomas Cook during the two-year transition. From 2019, the deal will switch to Thomas Cook paying Webjet "a volume-based service fee."
As well as the contracting side of the deal, Sunhotels will make its existing 75,000 properties available to the entire Thomas Cook business. Sunhotels currently works with it in the Nordics.
"We are very excited about this agreement as it provides a unique opportunity to significantly expand our B2B footprint in Europe over the next 5 years and beyond," said Webjet's MD John Guscic.
The news came at the same time as Webjet released its full year results for the period ending 30 June. The topline figures — TTV up 28.8% to A$1,630 million ($1,240 million), revenue up 29.1% to AUS$155.3 million ($118 million) and EBITDA up 31.4% to $36.6 million ($27.9 million) — represents its best-ever 12-month performance.
Its B2C operations — Webjet, Zuji and the recently acquired Online Republic — generated AUS$33.2 million ($25.3 million) of EBITDA, up nearly 40% year-on-year. B2B contributed AUS$3.4 million ($2.6 million) of EBITDA, down by 13% as a result of AUS$5 million ($3.8 million) extra spend on preparatory work for the Thomas Cook venture.
Its other B2B brand is Lots of Hotels, based in Dubai and specialising in hotels across the Middle East and Africa. During the year it launched Lots of Hotels North America and also moved both B2B brands onto the same tech platform.
The B2B brands handled around 500,000 bookings; the B2C brands more than 1.5 million. Combined, this equates to a 28% hike in volumes.
And the company says it is still keeping its revenue/TTV margins in the 9-9.5% range.
Click here to see its full-year results presentation to investors.
Related reading from Tnooz:
Webjet buys NZ rival Online Republic for $59 million (June 2016)
Hotelbeds sold for Euro 1.2 billion to Cinven and CPPIB (April 2016)
Webjet buys Sunhotels (July 2014)