Travel Technology
Spirit Airlines | September 13, 2023
Cover Genius announced entering into a partnership with Spirit Airlines.
By integrating the company's XCover, Cover Genius empowers its partners to provide personalized protection options during the checkout process.
Through this partnership, Spirit Airlines' passengers enjoy a top-tier experience, featuring straightforward protection options during booking and seamless digital claims processing.
On September 12, 2023, Cover Genius, a leading insurtech for embedded protection, providing a global distribution platform for any insurance or other type of protection, announced a partnership with Spirit Airlines, a market leader in offering customizable travel options starting with an unbundled fare.
This integration with Cover Genius' award-winning global distribution platform, XCover, will offer Spirit Airlines' non-US and non-Canadian citizen passengers the opportunity to purchase personalized embedded protection. This coverage comes with the added benefit of a swift claims process, marking the first time such an option is available to them.
Cover Genius, selected as the insurtech partner for some of the world's largest airlines, empowers its partners to provide customized protection options during the checkout process. These options can be flexibly bundled or unbundled to cater to each customer's specific requirements. With licenses or authorizations spanning over 60 countries and encompassing all 50 US states, Cover Genius enables partners to effortlessly extend protection to customers from any location, facilitating international expansion.
Rana Ghosh, Vice President of Omnichannel Sales at Spirit Airlines, said,
We are committed to providing our Guests with the best value in the sky, unbundled fares and customizable travel options.
[Source – Globe Newswire]
Partnering with Cover Genius enables them to augment the Guest experience. It allows them to provide customized travel protection for various regions and destinations, added Ghosh.
Through the partnership, Spirit Airlines' passengers enjoy a best-in-class experience with straightforward protection options while booking and seamless digital claims processing. The management of Guests' requirements, starting from the initial sale to administration and claims, is efficiently handled by Cover Genius' consumer brand, XCover.com. This exceptional service has led to an industry-leading post-claims Net Promoter Score (NPS) of +65. Furthermore, the award-winning service design has demonstrated a remarkable 7x reduction in support tickets.
Angus McDonald, CEO and Co-Founder of Cover Genius, stated,
We are thrilled to partner with Spirit Airlines to help international travelers feel more confident in their booking.
[Source – Globe Newswire]
While embedded protection in travel is a common practice, many airlines provide customers with a standard one-size-fits-all policy that fails to address the varying needs of different travelers. The approach has been changed to offer customers flexible protection, customized according to their itinerary or destination, and supported by real-time data. Additionally, customers benefit from a hassle-free claims process that includes instant payments in more than 90 currencies, said McDonald.
International Guests with Spirit Airlines now have the choice to acquire embedded protection supported by XCover. Notably, Spirit Airlines presently serves 27 destinations spanning 14 countries outside of the United States.
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Hospitality Management
PR Newswire | October 18, 2023
Choice Hotels International, Inc. announced a proposal to acquire all the outstanding shares of Wyndham Hotels & Resorts, Inc. at a price of $90.00 per share, payable in a mix of cash and stock.
Under Choice's proposal, the $90.00 per share to be received by Wyndham shareholders would consist of $49.50 in cash and 0.324 shares of Choice common stock for each Wyndham share they own. Choice's proposal represents a 26% premium to Wyndham's 30-day volume-weighted average closing price ending on October 16, 2023, an 11% premium to Wyndham's 52-week high, and a 30% premium to Wyndham's latest closing price. In addition, Choice's proposal includes a cash or stock election mechanism, which would provide Wyndham shareholders with the ability to choose either cash, stock, or a combination of cash and stock consideration, subject to a customary proration mechanism. The proposal implies a total equity value for Wyndham of approximately $7.8 billion on a fully diluted basis. With the assumption of Wyndham's net debt, the proposed transaction is valued at approximately $9.8 billion.
Choice is making its latest proposal public following Wyndham's decision to disengage from further discussions with Choice, following nearly six months of dialogue.
Patrick Pacious, President and Chief Executive Officer of Choice Hotels, said, "We have long respected Wyndham's business and are confident that this combination would significantly accelerate both Choice's and Wyndham's long-term organic growth strategy for the benefit of all stakeholders. For franchisees, the transaction would bring Choice's proven franchisee success system to a broader set of owners, enabling them to benefit from Choice's world-class reservation platform and proprietary technology to drive cost savings and greater investment returns. Additionally, the value-driven leisure and business traveler would benefit from the combined company's rewards program, which would be on par with the top two global hotel rewards programs, enabling them to receive greater value and access to a broader selection of options across stay occasions and price points."
"A few weeks ago, Choice and Wyndham were in a negotiable range on price and consideration, and both parties have a shared recognition of the value opportunity this potential transaction represents. We were therefore surprised and disappointed that Wyndham decided to disengage. While we would have preferred to continue discussions with Wyndham in private, following their unwillingness to proceed, we feel there is too much value for both companies' franchisees, shareholders, associates, and guests to not continue pursuing this transaction. Importantly, we remain convinced of both the many benefits of the combination and our ability to complete it," concluded Pacious.
STAKEHOLDER BENEFITS
The proposed transaction is expected to provide important benefits for both companies' stakeholders – franchisees, shareholders, associates, and guests – that will be particularly significant in the current uncertain economic climate:
Franchisees Win with Lower Total Cost of Ownership and Increased Hotel Profitability.
Capitalizes on Choice's proven franchisee success system, dedicated to driving incremental topline reservation delivery to hotel owners' properties, while lowering the total cost of hotel operations.
Nearly doubles the resources available to spend on marketing and driving direct bookings to franchisees' hotels, lowering the cost of customer acquisition.
Establishes an even larger rewards member base on par with the top two global programs in hospitality.
Drives more business to franchisees through lower cost direct booking channels, lower customer acquisition commissions and fees, and lower hotel operating costs and technology-driven labor efficiencies, while continuing to determine their own commercial and pricing strategy.
Improves the value of franchisees' real estate assets by enhancing applicable cap rates and cash flows resulting from affiliation with the proforma company.
Reduces friction by offering guests a broad portfolio of brands across segments, no matter their stay occasions, within a single system.
Promotes increased investment and innovation in proprietary technology systems, processes, and training at the hotel and corporate level, which drives returns for Choice franchisees.
Creates an opportunity to replicate the tremendous success of Choice's recent acquisition of Radisson Hotel Group Americas. During the integration of the nearly 600 Radisson Americas hotels into the Choice platform, Radisson's franchisees have already meaningfully benefited from increased guest traffic to direct and digital channels, improvement in conversion rates, and access to more corporate accounts, among other benefits.
Shareholders Win with Superior Value Creation.
Represents a 26% premium to Wyndham's 30-day volume-weighted average closing price ending on October 16, 2023, an 11% premium to the 52-week high, and a 30% premium to the latest closing price.
Anticipates meaningful annual run-rate synergies, estimated at approximately $150 million, through the rationalization of operational redundancies, duplicate public company costs, and topline growth potential.
Enables Wyndham shareholders to benefit from Choice's historically 3x higher EBITDA multiple on a go-forward basis and receive deferred tax treatment on their stock consideration.
Creates additional capacity to further support Choice's revenue intense strategy, ultimately helping drive growth across its organic revenue levers.
Generates predictable high free cash flow through an asset-light, fee-for-service model, providing resiliency through all economic cycles and enabling additional investments for future growth.
Offers Wyndham two seats on the combined company's board and Wyndham shareholders the opportunity to participate in the significant upside potential of the combined company.
Cash/stock consideration mechanism enables Wyndham shareholders to choose between immediate upfront proceeds or long-term value creation, subject to a customary proration mechanism.
Guests Win with More Lodging Options and Value.
Creates a combined rewards program on par with the top two global programs in hospitality and will offer best-in-class program benefits through partnerships and compelling hotel redemption options.
Builds a global network of brands and hotels that meets the needs of the value-driven traveler across geographies, stay occasions and price points, supported by a seamless reservation system that provides guests with a more effective and efficient booking and shopping experience.
Improves data analytics, enabling the combined company to personalize communications and tailor recommendations to best meet the needs of the up to 160 million combined rewards program members.
Associates Win with Expanded Opportunities and Increased Stability.
Offers the ability to retain and attract "best-in-class" talent to one of the world's premier hotel companies focused on employee well-being, bringing together a wide range of experience and deep industry expertise.
Provides more opportunities for advancement and career growth as part of a larger, more diversified organization.
Combines two performance-driven cultures with a continued emphasis on associate development and growth.
RECENT ENGAGEMENT OVERTURES
Choice has been engaging with Wyndham for nearly six months.
In April 2023, Choice sent its initial letter to Wyndham regarding a potential transaction, proposing to acquire Wyndham for $80.00 per share, comprising 40% cash and 60% Choice stock. The proposal represented a 20% premium to the closing price of Wyndham common stock on April 27, 2023, and a 19% premium over Wyndham's 30-day volume-weighted average share price as of such date. Wyndham rejected the proposal and refused to engage in further discussions.
In the days and weeks thereafter, Choice continued to attempt engagement with Wyndham, increasing its proposal to $85.00 per share, comprising 55% cash and 45% Choice stock, explaining that further discussions could clarify Wyndham's hesitation to proceed with negotiations. The companies' respective Board Chairs and CEOs then met in person, and following that meeting, Choice improved its proposal yet again. Choice made its best and final offer which represented an increase of the per-share consideration to $90.00, comprising 55% cash and 45% Choice stock.
In September 2023, the Choice and Wyndham Board Chairs continued engagement, along with each of their respective financial and legal advisors. Wyndham acknowledged the strategic rationale of the proposal and that terms were within a negotiable range but raised questions regarding the value of Choice stock and timing for obtaining regulatory approvals. In response, Choice proposed to enter into a one-way, short-term non-disclosure agreement to facilitate Choice providing information that would address Wyndham's concerns (a draft of which was subsequently sent to Wyndham) and made its external counsel available for several discussions. However, during a follow-up call between the Chair of each company's Board and their respective advisors, Wyndham made clear their unwillingness to proceed with further discussions.
FINANCING, CONDITIONS AND APPROVALS
Closing of the contemplated transaction would be subject to satisfaction of customary closing conditions, including receipt of required shareholder and regulatory approvals. Choice would not make this offer if it were not confident that its franchisees and guests would embrace the proposed combination and that the transaction would receive applicable regulatory approvals in due course.
The cash portion of the purchase price is expected to be funded with a combination of cash on hand, as well as proceeds from the issuance of debt securities. Choice is highly confident in its ability to obtain fully committed financing based on indications from two separate bulge bracket global banks for the entire cash portion of our proposal. Strong free cash flows will allow for continued investments in the proforma business and rapid deleveraging of the balance sheet.
About Choice Hotels
Choice Hotels International, Inc. is one of the leading lodging franchisors in the world. Choice® has nearly 7,500 hotels, representing almost 630,000 rooms, in 46 countries and territories. A diverse portfolio of 22 brands that range from full-service upper upscale properties to midscale, extended stay and economy enables Choice® to meet travelers' needs in more places and for more occasions while driving more value for franchise owners and shareholders. The award-winning Choice Privileges® loyalty program and co-brand credit card options provide members with a fast and easy way to earn reward nights and personalized perks.
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Travel Technology, Business Travel
Business Wire | November 01, 2023
PriceTravel Holdings, a global distribution company with a stronghold in Latin America and The Caribbean, has announced a strategic technology collaboration with Vervotech, a renowned B2B accommodation data management brand offering AI-driven mapping solutions to online travel companies worldwide.
PriceTravel Holdings has been providing top-quality travel services for over 20 years, cementing its position in the travel industry.
With this new alliance, all travel agencies partnered with PriceTravel Holdings will now have access to impeccably mapped, deduplicated, and enriched accommodation data with over 40 unique attributes, ensuring unparalleled accuracy through Vervotech's AI-based mapping products.
This collaboration further empowers Vervotech with access to PriceTravel Holdings' expansive static content, expanding its already extensive network of 400+ large suppliers.
Ivonne Arriola, Wholesale Director, PriceTravel Connect, commented on the affiliation, “We are extremely pleased to join hands with Vervotech to offer a more integrated technological platform for over 300 clients worldwide working with us. This collaboration will benefit both our prospective and existing customers by providing them with access to Vervotech's modern AI-based mapping technology. With this partnership, we reaffirm our commitment to delivering exceptional travel solutions to our clients.”
Sanjay Ghare, CEO of Vervotech, added, “Partnering with PriceTravel Holdings presents exciting opportunities for both of our organizations. We are eager to leverage PriceTravel Holdings' expertise to enhance our offerings with their high-quality content. I'm incredibly bullish about this partnership and confident that together, we can offer more advanced travel technology products for our respective customers.”
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