Travelport IPO Begins On a High Note
by Michele McDonald /Against the backdrop of a “horrific market,” Travelport kicked off its initial public offering at the top of its price range—set at $14 to $16.
And as the Dow Jones Industrial Average plunged about 250 points, due to global crises and missteps in Apple’s new iPhone rollout, Travelport watched its price rise.
In early trading, the stock price reached a high of about $17.70, but it leveled off at around $16.80, 5.5% above the initial price, for most of the afternoon. It closed at $16.40, 2.5% above the initial price.
Gordon Wilson, Travelport’s chief executive officer, told Travel Market Report that it was the third successful IPO by a GDS company in recent years, following Amadeus’ in 2010 and Sabre’s in April.
Alive and kicking
The latest success is “good for the sector as a whole,” he said. “Investors are seeing just how good these businesses are,” putting the lie to “uninformed” people’s pronouncements that GDS companies are “dinosaurs” and practically dead.
Wilson attributed the success in attracting investors “categorically” to the story Travelport has been telling for some months: The repositioning of the company as a travel commerce platform, the work it has done in the hotel space, the development of its airline merchandising platform, and its foray into B2B payments, which has “massive growth potential.”
“We’re investing far more than our competition,” he said. “Basically, we’re a very attractive company.”
Refinancing Travelport’s debt, which reduced its interest payments by about half, also helped. “We wouldn’t have been able to do the things we’ve done without that,” Wilson said.
Now that the big moment is over, Wilson said he is “going back to my day job.”
The company still has a lot of work to do on the rollout of Rich Content and Branding, a component of the merchandising platform, and it is “still scratching the surface” of the payments business.