Travelguru buys Desiya.com for $25 mn
Travelguru, the online travel portal has signed a strategic agreement to acquire Desiya.com, a B2B hotel portal based in Gurgaon, reports Saurabh Turakhia.india Updated: Dec 20, 2007 23:52 IST
Travelguru, the online travel portal has signed a strategic agreement to acquire Desiya.com, a B2B hotel portal based in Gurgaon. The deal size is $25 million. Desiya.com is a New Jersey-based online travel company with offices in London, New Jersey, Gurgaon and Kolkata.
Speaking to Hindustan Times, Ashwin Damera, founder & CEO of Travelguru.com said, “Since Desiya operates in the B2B online travel and we operate in the B2C online travel space, this acquisition is complementary for us. It will make us leaders in the online hotel business space.”
Talking about financials, Damera said that Travelguru, which has been backed by VC firms like Battery Ventures and Sequoia Capital India would break even in August or September 2008. By 31 March 2008, it expects revenues of $45 million.
The company has seen two rounds of funding totaling to $25 million. Damera holds a founder’s equity share in the company as well.
Damera estimates that the Indian online travel market has a size of $500 million of which it claims a 10 per cent share. In the online travel space, various entities like Travelguru, Yatra, Indiatimes Travel, Cleartrip and Makemytrip operate. The online players are eating into the share of traditional travel agencies. The space is clearly maturing. Yatra is planning for an IPO sometime in the next financial year and Makemytrip.com has already received the third round of funding a few months back amounting to $15 million.
Expedia Inc., the world’s largest online travel agency with more than $17 billion in annual gross travel bookings also has plans to enter India through a subsidiary next year. PhocusWright, a company doing research on the online travel business predicts that the online leisure market will be worth over $2 billion in 2008, of which 25 percent will be transacted by online travel agencies - compared with only $300 million in 2005.
Between 2005 and 2006, eight online travel agencies start-ups or subsidiaries launched services in India.
Their share of the travel market is expected to more than triple from 7 per cent in 2006 to 25 per cent by 2008.