Piece by piece, private equity firm Warburg Pincus is making Mercator a rival to Saber and Amadeus – two travel technology providers that provide overlapping software and operational services to commercial airlines (and which recently went public. after restructuring by buyout experts). Expect Mercator’s merger with Accelya to trigger a wave of acquisitions.
Sean O’Neill, Skift
Barcelona-based airline services company Accelia, which helps airlines like American Airlines and British Airways manage costs, merge with Mercator, a Dubai-based travel services company. From now on, the combined companies will keep their separate brands, but the pattern of other similar mergers (such as Saber’s acquisition of Abacus) suggests that Mercator will become the primary brand over time.
Warburg pincus, a US private equity firm that owns a majority stake in Mercator, led the transaction. Terms of the transaction were not disclosed. The combined company will have pro forma annual revenues of more than $ 200 million, according to the companies.
The unified business will provide accounting, auditing and other financial services in a unit that will make it a competitor to the four largest travel technology services companies in the world. Amadeus, Saber, Travel port, and Travelsky, which to varying degrees have secondary activities in the provision of air services.
Mercator and Accelya indicate that they plan to help their more than 250 airline customers by “optimizing the management of their indirect distribution channel”. This means that while they will help airlines sell directly through airlines’ websites and mobile apps, they will also help airlines make decisions about how they will distribute products “indirectly” through marketplaces. third parties such as Saber, Amadeus and Travelport. offers to travel agencies.
Mercator and Accelya market some of their services as more aware of technology than those offered by so-called global distribution systems (GDS).
Warburg Pincus buyout experts seem to want to start an alternative services company for commercial airlines. Over the past year, Mercator has also purchased Revenue Management Systems (RMS), a software provider with 70 airlines.
That said, Mercator is still a long way from providing IT services to airlines at the scale of billionaire company Amadeus, in particular.
But the business is progressing. The combined company also assists passenger airlines like JetBlue, United and Qantas with their operations, such as passenger reservations, loyalty programs, and support for revenue management analysts. set air fares (and sell incentive products) at optimal prices.
Experts in the buyout of Warburg carved out Mercator of the Emirates group in 2014.
Mercator has grown in importance for its service to freight operators.
But since Cormac Whelan took over as Managing Director of Mercator a year ago, he has confidently moved the company into passenger services for commercial airlines. Whelan has experience as a CEO for eight years at Datalex, which provides airlines with retail software, and chairman of Boxer, a marketing service provider for travel agencies. This experience gave Whelan a sense of the landscape of technology providers serving the global airline industry – and perhaps a glimpse of possible combinations that could reach scale.