E-commerce firm Ibibo Group on Friday acquired Bangalore-based online bus ticketing firm RedBus for an undisclosed sum. Market sources pegged the deal at Rs 600 crore.
Ibibo Group's holding company MIH Ltd is owned by South Africa's media house Naspers. RedBus was started by Phanindra Sama in 2006 as an an online bus-ticketing platform that aggregates inventory from bus operators and makes it available to end consumers. The portal sells more than a million tickets a month and has over 600 full-time employees. The core business model of RedBus is commission revenues on successful transactions.
"This gives us significant scale in terms of daily transaction volumes. We see this as an exciting market opportunity. Online penetration of the bus market is only 5-7% compared to 28% for air travel, suggesting headroom for future growth," said Ashish Kashyap, group CEO, Ibibo Group.
All travel companies of Ibibo Group, including RedBus will continue to run independently and operate as separate businesses to drive deep focus.