Mondee Buys Airfare Wholesaler in Play for Ethnic Travel Agencies
Skift Take
Mondee's acquisition of fast-growing CTS (Cosmopolitan Travel Service) makes the group North America's largest airfare wholesaler by market size. Notably, Mondee could afford the deal thanks to fresh backing by TCW Group, a giant asset management firm. Lots of institutional money is seeking opportunities in travel this year.
Institutional money is betting that technology can squeeze out new profits from an old business model: ethnic travel agencies. They're doing so via investments in Mondee, a tech platform provider that has rolled up several airfare consolidators that primarily serve ethnic travel agencies.
In the past year, TCW Group, an asset management firm with $217 billion under management, has joined earlier investor Morgan Stanley Private Credit and Equity in financially supporting the expansion of Mondee. On Tuesday, Mondee said it had used some of this money to acquire, for an undisclosed price, CTS (Cosmopolitan Travel Service), a 50-year-old airfare wholesaler based in Detroit.
This year, the combined Mondee group will generate about $3.5 billion in gross bookings for airfares, said Mondee CEO Prasad Gundumogula. The deal makes Mondee, based in Foster City, California, the largest airfare consolidator group in North America.
Gundumogula conceded that CTS was growing faster than any of the airfare wholesalers that it has rolled up
