Amex to Create Business Travel Division JV for $900 Million Investment (March 25, 2014)
American Express is creating a joint venture for its Global Business Travel division (GBT), in which the card network will share ownership of the JV with an investor group led by New York investment firm Certares. As part of the proposed transaction, American Express will separate its GBT operations and retain a 50 percent ownership stake. The investor group will hold the remaining 50 percent, in exchange for a $900 million investment in the JV, according to an announcement.
GBT provides travel solutions, consulting services, research, and meetings and events capabilities. The division has more than 14,000 employees, with operations and network partners in 139 countries.
Other investors include Qatar Investment Authority subsidiary Qatar Holding LLC, BlackRock and Macquarie Capital. Bill Glenn, former president of global commercial services at American Express, will be president and CEO of the JV, and Certares founder Greg O’Hara will serve as chairman. The JV “will accelerate our growth by funding meaningful advances in technology, analytics and service excellence that will benefit suppliers, partners and our global customer base,” Glenn said.
American Express intends to close the deal in the second quarter of this year, assuming all regulatory approvals are received, and the business will continue to operate under the American Express Global Business Travel brand.
“The joint venture reflects our continued commitment to the travel business through a new structure with an outstanding group of investors and the resources to grow the business and provide additional value to our corporate customers,” said Kenneth I. Chenault, American Express chairman and CEO.