US-based software firm Ebix Inc Tuesday said it has commenced due diligence for signing an agreement to acquire Yatra Online Inc, the parent company of online travel firm Yatra.com, by May 15.
Ebix Inc has "officially engaged with Yatra Online Inc to commence its due diligence immediately, with the goal of working towards signing the agreement to acquire Yatra Online latest by May 15, 2019," the company said in a statement.
The company intends to merge Yatra Online with its Indian subsidiary EbixCash. The offer is subject to due diligence and customary regulatory and other closing conditions, it added.
EbixCash operation on a standalone basis is targeting quarterly annualised revenues of USD 600 million by the fourth quarter of 2019, the statement said.
On March 15, Yatra Online Inc said in a statement that it had entered into a mutual confidentiality agreement with Ebix Inc so that the parties can commence due diligence and Yatra can further review and consider Ebix's proposal made earlier to acquire all of the outstanding stock of Yatra.
Consistent with its fiduciary duties and in consultation with its independent legal and financial advisors, "the Yatra Board of Directors is reviewing and considering Ebix's proposal to determine the course of action that it believes is in the best interest of the company and all of its shareholders," it added.
Yatra also said there can be no assurance that a transaction will result from this process.
Gurugram-based Yatra.com is a major player in the online travel sector and provides services including domestic and international air ticketing, hotel bookings, homestays, holiday packages, bus ticketing, rail ticketing, activities and ancillary services.
Ebix Inc had earlier sent a letter to the board of Yatra Online Inc outlining offer to acquire 100 per cent of the outstanding stock of Yatra Online for USD 7 per share on a debt-free basis.
Highlighting the rationale for the transaction, Ebix had said it believes that Yatra Online can generate revenues upward of USD 150 million per year with over 30 per cent operating margins on a post-closing basis, within six months of the acquisition by Ebix.
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