HumanIPO reported last week Naspers was likely to acquire a controlling stake in RedBus valued at approximately US$100 million.
In India, online bus ticketing penetration is reportedly less than 6 per cent and this latest acquisition will reportedly elevate the group to one of India’s largest online travel industry players.
This is due to the Ibibo Group existing travel assets being combined with RedBus’ resources. Ibibo’s online travel resources include Gobibo.com, a leading online travel aggregator and TravelBoutiqueOnline, which is an online business-to-business (B2B) travel platform.
Ibibo made the binding offer to purchase RedBus for an undisclosed amount, which confirmed the prior speculation in both the South African and Indian media. However the Ibibo group did not confirm speculation regarding the deal being worth US$137.2 million.
RedBus reportedly sells more than one million tickets monthly and aggregates approximately 228,000 bus seats on a daily basis from a large number of bus operators.
It also allows commuters to purchase tickets online through both call centres and mobile phones.
“This marriage leapfrogs us to become an even stronger online travel player in India. We see this as an exciting market opportunity. Online penetration of the bus market is only 5.7 per cent compared with 28 per cent for air travel, suggesting headroom for rapid future growth,” the Independent Online (IOL) quoted Ashish Kashyap, chief executive of the Ibibo Group, as saying.
Naspers owns 80 per cent of Ibibo, which is a joint venture between the media company
and Tencent, the largest internet service portal in China.
According to Naspers, it has a 34 per cent stake in Tencent.
“Naspers’ strong belief in the internet industry and operating experience in multiple countries will help RedBus grow into a renowned brand in the coming years,” Phanindra Sama, chief executive of RedBus, said.
Naspers has made e-commerce a business priority and started with investing in the internet approximately 13 years ago in 2001. By September last year Naspers had acquired Flipkart, Netrail and eMag.
According to Ibibo, RedBus will continue to operate independently.