India is seen as next big internet market owing to digital revolution, economic growth and potential market strength. MakeMyTrip and Goibibo join hands to become a market leader in travel industry of Indian online travel segment. (IndiaTimes, 2016) views this as a potential move to grab Indian market and tighten its grip over the market that MakeMyTrip already enjoys 35% stake.
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About Ibibo Group
Ibibo group is an online travel company founded by Ashish Kashyap in 2007. (Livemint, 2016) states that the company is a subsidiary of Nasper. Nasper has 91% stake and TenCent has 9% stake in the Ibibo Group. Company operates through following brands.
- Goibibo - Hotels and Air ticketing portal
- redBus – Bus booking website portal
- Ibibo (currently owned by Nasper) will be merged into MakeMyTrip
- Merger is through stock transaction
- (Medianama, 2016), Nasper-TenCent combine will become largest shareholder in new entity with 40% stake
- (Medianama, 2016), Chinese OTA Ctrip, will have around 10% stake in new entity
- (IndiaTimes, 2016) estimates the merger through sources at about $1.8-$2.0 billion
- Morgan Stanley – financial advisor of MakeMyTrip
- Goldman Sachs – financial advisor of Ibibo Group
- All brands of Ibibo group like Goibibo, redBus, Ryde and Rightstay would come under MakeMyTrip (new entity)
Business Share in Travel Industry
New organization structure
Figure 2 New Organization Structure
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- Deep Kalra, Founder of MakeMyTrip – Group CEO and Executive Chairman, MakeMyTrip
- Rajesh Magow, Co-founder of MakeMyTrip – CEO India, MakeMyTrip
- Ashish Kashyap, Founder and CEO of ibibo Group – Co-founder and Presidnet of the organization (MakeMyTrip Executive team)
IndiaTimes. (2016, 10 19). EconomicTimes. Retrieved from EconomicTimes: http://economictimes.indiatimes.com/small-biz/startups/online-travel-portals-makemytrip-and-ibibo-announce-merger/articleshow/54921415.cms
Livemint. (2016, 10 19). Livemint. Retrieved from Livemint: http://www.livemint.com/Companies/W9atx25k79RpQcdbRxWuTP/MakeMyTrip-to-buy-rival-ibibo-Group.html
Medianama. (2016, 10 19). Medianama. Retrieved from Medianama: http://www.medianama.com/2016/10/223-makemytrip-ibibo/