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Sabre has been an active acquirer over the years, but in 2013 it sold three businesses — Travelocity Business, Holiday Autos and Zuji — all at a loss. Sabre wanted to execute a successful IPO, and it had plenty of things to tidy up.
Now that the veil has been lifted as privately held Sabre filed its IPO registration statement, details have emerged about the company’s asset-disposition frenzy in 2012 and 2013, mostly in an attempt to trim losses and pretty up the balance sheet in preparation for going public.
The coup de gras was the recently implemented agreement that has Sabre outsourcing the back-end operations of its Travelocity unit in North America to Expedia.
Sabre is trying to trim its losses at Travelocity. For the first nine months of 2013, Sabre took a $96 million impairment charge for Travelocity North America, and another $40 million for Travelocity Europe.
But, Sabre was also busy selling assets.
For example, in 2013 Sabre took a $25 million loss in selling its Singapore-based online travel agency, Zuji, to Webjet.
In 2006, Sabre’s Travelocity spent $34 million to acquire the roughly 86% of Zuji that it didn’t already own from Abacus and 15 airlines in the region.
Also in 2013, Sabre took a $3 million loss in selling Travelocity Business to BCD Travel.
On the plus side in 2012, Sabre recorded a gain of $25 million in selling its 51% stake in Sabre Pacific, an Australia-based distribution business, to Abacus.
Of the six business that Sabre sold in 2012-2013, it took losses on four of the transactions.
In the charts below, you can also see the acquisition prices that Sabre paid for some of the six acquisitions, including the $116 million it paid for PRISM Technologies, an airline contract business intelligence service, it made from 2010 to 2012.
In 2013, though, with its then-looming IPO the worst-kept secret in travel, Sabre clearly was no longer in acquisition mode.
Losses Mount on Sabre Asset Dispositions
|Company Sold||Buyer||Year||Business Type||Sabre’s Net Gain/Loss|
|Travelocity Business||BCD Travel||2013||Corporate travel||($3 million)|
|Holiday Autos||Car Trawler||2013||Leisure car rental||($11 million)|
|Zuji||Webjet||2013||Online travel, hotel reservations, Singapore||($25 million)|
|TravelGuru||Yatra||2012||Online travel, hotel reservations, India||$11 million|
|Travelocity Nordics||Resfeber||2012||Online travel, event tickets, Sweden, Norway, Denmark||($3 million)|
|Sabre Pacific*||Abacus||2012||Global distribution, Australia||$25 million|
* Sabre sold its 51% stake in Sabre Pacific to joint venture partner Abacus
Sabre Acquisitions 2010-2012
|Company||Year||Business Type||Acquisition Price|
|PRISM Technologies||2012||Airline contract business intelligence||$116 million|
|Zenon N.D.C.||2011||Global Distribution System, Cyrprus||$11 million*|
|SoftHotel||2011||Hotel property management solutions||N/A|
|Calidris||2010||Business intelligence, Iceland||$52 million**|
|FlightLine||2010||Crew-scheduling software, North America||N/A|
|Flugwerkzeuge Aviation Software||2010||Flight planning, Austria||N/A|
* Sabre acquired Zenon and SoftHotel for a total of $11 million in 2011, and didn’t detail what it paid for each.
** Sabre acquired Calidris, FlightLine and Flugwerkzeuge Aviation Software (f:wz) for a combined $52 million in 2010, and didn’t break down what it paid for each.
Source: Sabre S-1, other public information