Skift Take
The company still hasn't recovered from the slump in business travel post-recession, and with the macro picture on the sector changing fast with rise of digital, divesting, at least part of it, is the right move.
American Express, in the midst of restructuring and trimming cost on its ailing business travel unit, has finally decided to sell it off, at least half of it. It said today it is in talks with an investor group led by private investment firm Certares to create a joint venture for its Global Business Travel division. Certares, based in New York City, has partners that have significant experience in the business travel market, including companies such as Travel Leaders Group, Travelport, Carlson Wagonlit Travel and others.
As the deal is currently being talked about AMEX would maintain a 50 percent ownership stake in the JV, which would continue to operate under the American Express Global Business Travel brand, while the investor group led by Certares would own the remaining 50 percent. The group will also invest about $700 million to $1 billion, in the venture to grow it though over what period isn’t specified. The deal is expected to close in Q2 of 2014.
The consumer travel business of AMEX, also going through a restructuring — it recently deiced to shut all company owned travel stores — will not be affected by this deal.
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Tags: american express, certares