FLIGHT Centre Travel Group (FCTG) is set to acquire luxury tour operator Scott Dunn, funded by a $180 million equity raising.
The total purchase price of the United Kingdom-based Scott Dunn is valued at £121 million ($211 million), with the company to provide Flight Centre an entry point into the UK and United States luxury travel market.
Eligible existing shareholders will be offered the ability to participate in a non-underwritten share purchase plan to raise up to a further $40 million for the acquisition.
The purchase will allow Flight Centre to diversify its Northern Hemisphere leisure footprint, aligned with its strategic objectives of expanding its core markets and developing a global collection of luxury travel brands.
Scott Dunn’s two main established markets are in the UK and United States, representing 74% and 21% of the company’s TTV (£112 million) for the 12 months to 31 October 2022.
Flight Centre also expects Scott Dunn to provide it with an entry point into a segment of the market and geographies where the company is underrepresented.
FCTG Managing Director Graham Turner said the company is excited to welcome Scott Dunn.
“Scott Dunn provides us with the opportunity to grow our leisure presence in the large UK and US luxury markets in an attractive and growing segment, while also fast-tracking our objective of developing a global luxury collection of travel brands,” he said.
“The business ticks the main boxes that we have defined to play in the luxury segment: exceptional service/high quality, an authentic brand with desired benefits, it has a prestigious image, commands a premium price, and is capable of inspiring deep connections with customers.
“High-net-worth, time-poor customers highly value the services of Scott Dunn as shown by their customers’ loyalty.”
Scott Dunn Chief Executive Officer Sonia Davies will continue to run the company as a separate business unit.