The all-cash transaction is expected to close in a few weeks and following the closing, the travelmob management team will retain a 37 percent share of the business and continue to operate as an independent brand from its Singapore headquarters. For the remainder of fiscal 2013, HomeAway® expects to incur about $2.0 million in additional expense to further grow the travelmob business. While the price and terms of the deal have not been disclosed, HomeAway will discuss this acquisition during its second quarter 2013 earnings conference call on Thursday, July 25.
HomeAway has a previous relationship with travelmob through a distribution partnership announced in March of this year. Built on a transaction-based model, travelmob features over 14,000 Asia Pacific short-term rental listings including luxury villas, urban apartments, houseboats, a private island and even some shared spaces. Co-founded in 2012 by Chief Executive Officer Turochas Fuad and Chief Technology Officer Prashant Kirtane, the site and its 16-person-team supports 13 currencies and operates in Bahasa, Chinese, Japanese, Korean, Russian, Thai, Vietnamese and English. Early investors of the start-up include Jungle Ventures, Accel Partners and private investors, including Dan Neary, vice president of Asia Pacific at Facebook.
"Economists note over 100 million people will enter the Asian middle class each of the next several years, and Asia will have an increasing influence over the world's economic growth. We believe this will have significant implications for not only travel but also for the purchase of homes, both of which drive HomeAway's growth," says Brian Sharples, chief executive officer of HomeAway. "We view Asia as a region where we can build tremendous incremental value for our shareholders and existing customers over the next several years. Given this opportunity, we're excited to work with the experienced travelmob team to address today's market needs in Asia -- where vacation rentals are mostly new, but alternative accommodations are not -- to build scale and accelerate the development of the vacation rental industry."
"We are excited to join HomeAway as the vacation rental industry develops in Asia. We see an increasing trend of Asian travelers expressing a preference for authentic experiences and the quality and value afforded by our range of properties," says Fuad. "Our focus at travelmob is to enable travelers to experience Asia like a local, staying at the cool places throughout this vast region. In our first year alone, our inventory has grown to more than 14,000 properties to support this growing demand."
Since April 2011, HomeAway has steadily invested in its Asia Pacific presence beginning with the purchase of the holiday rental business from REA Group Limited and the subsequent launch of HomeAway.com.au. Last year, HomeAway made a minority investment in China-based vacation rental company, Tujia.com, in partnership with Ctrip.com International (NASDAQ: CTRP), the leading online travel service provider in China. The company also has distribution partnerships with Wego.com and Tripvillas.com. Most recently, HomeAway opened a sales office in Bangkok, Thailand in April of this year to serve the growing inventory of private villas offered to the public as vacation rentals.