- Sabre’s Transaction allows it to optimize its portfolio and pay off debt. Keep the Focus on Sustainable Growth
- Transaction Will Establish Hospitality Solutions Business As an Independent Technology Company Built For The Hospitality Industry
Sabre Corporation (NASDAQ: SABR), a leading technology provider to the global travel industry, and TPG, (NASDAQ: TPGTPG, a global alternative investment management firm, announced today the signing of an agreement conclusive under which TPG agreed to purchase Sabre’s Hospitality Solutions (Hospitality Solutions) for $1.1 billion cash. TPG Capital will invest in Hospitality Solutions, TPG’s U.S. & European private equity platform.
The transaction will create Hospitality Solutions, a separate business that provides dedicated resources to growth and expansion of the hotel technology platform globally. Hospitality Solutions offers software and solutions for more than 40% of the leading hotel brands in the world. SaaS-based platform allows hoteliers to work more efficiently and accurately. Hospitality Solutions is separate from Sabre’s hotel B2B business, which continues to be a strategic investment area for Sabre.
Sabre’s cash proceeds will primarily be used to pay down its debt. The expected $960m, net of tax and fees, will enable Sabre improve its balance sheets, optimize its focus on its core businesses, and continue to focus its long-term sustainable business growth. This announcement is part of a series by the Company of strategic financial decisions, including debt refinancings scheduled for December 2024, and recent repayments of debt maturities in April 2025.
- Reinforce Sabre Capital Allocation Framework;
- Improve the capital structure.
- Improve its ability to refinance remaining maturities opportunistically.
Sabre is committed to driving shareholder value over the long term by optimizing their product portfolios and accelerating their path towards a net leverage goal of 2.5x to 3x.
“The $1.1 billion sale is testament to the transformation the Hospitality Solutions Team has led over the last few years,” said. Sabre can now focus on its core airline IT platforms and travel marketplaces. TPG’s expertise and investment approach will bring significant value to Hospitality Solutions customers. Kurt Ekert President and CEO, Sabre Corporation
Sabre acquired SynXis in 2005, which was the core of their hospitality business. Since 2005, the Company continues to invest in new capabilities and solutions such as Retail Studio. Hospitality Solutions has become the central booking platform of many of the most prestigious and largest hotel brands around the globe.
Platforms like Hospitality Solutions are essential for its customers in managing and delivering great experiences for guests. We have a long history of partnering with mission-critical software businesses like Hospitality Solutions that – with the right combination of capital and operational focus – can achieve meaningful growth. The transaction represents our distinct carveout experience and thematic approach to investing. We are looking forward to working with Hospitality Solutions to enhance and extend the platform. Tim Millikin, Partner at TPG
The hospitality sector continues to grow and evolve. Hospitality Solutions’ tailored offering enables hotels of all kinds to meet guests wherever they are, and prioritize their needs. Our decades of investment experience in travel and software sectors is brought together by this transaction. We are looking forward to building the platform to become a comprehensive technology solution for the hospitality sector. Paul Hackwell, Partner at TPG
TPG’s deep expertise in corporate carveouts has helped it support and grow innovative companies such as Boomi Elite Everfox McAfee Wind River.
The parties also expect to enter a transition service agreement in addition to the above described purchase agreement. Under this agreement, Sabre will assist the parties with the transition of Hospitality Solutions following the closing. The Board of Directors of Sabre Corporation approved the transaction, and it is expected that the transaction will close by the third quarter of 2025. This depends on the usual closing conditions and regulatory approvals. The closing of the deal is not subjected to any financing conditions.
To learn more about the conditions of the definitive transaction contract, please refer to Sabre’s current report on form 8-K which will be submitted with the U.S. Securities and Exchange Commission.
Advisors
Haynes Boone LLP serves as the legal counsel for the Company. Evercore acts as its financial advisor. William Blair serves as TPG’s financial adviser. Davis Polk & Wardwell LLP is serving as legal counsel to TPG.
About Sabre Hospitality
Sabre Corporation, a leader in technology, is committed to solving the most complex travel challenges and tackling the largest opportunities. Sabre harnesses speed, scale and insights to build tomorrow’s technology today – empowering airlines, hoteliers, agencies and other partners to retail, distribute and fulfill travel worldwide. Headquartered in Southlake, Texas, USA, with employees across the world, Sabre serves customers in more than 160 countries globally. Visit the website for more information. www.sabre.com.
Visit our website for more information www.sabrehospitality.com.
