Travel booking firm Cleartrip has acquired Saudi Arabia-based online travel aggregator Flyin as it looks to further consolidate its market presence within its focus markets.
Although the deal value was not disclosed, a source familiar with the matter said that it amounted to more than $70 million. Cleartrip said in a press release that it was one of the largest deal in the travel space and will provide the company with a wider reach and a larger client base in one of the region’s biggest market.
“When we started we realized that Saudi is a lot more complicated than other GCC markets,” Stuart Crighton, Founder and CEO of Cleartrip said in a phone interview. He added that the acquisition will help Cleartrip achieve scale in the Kingdom while improving its market share.
Post the deal, Cleartrip will have a 60% market share in the GCC, the company said. Founded in 2008, Flyin says that it is the largest online travel company in KSA.
Cleartrip, which originated in India, is now increasing its market presence in the Middle East. It has a 22% market share in its home market of India but has rapidly gained ground in the GCC too.
Crighton said that about 40% of its revenues come from its Middle East market today and the company has a turnover of $600 million within the region.
Travel market in the Middle East is worth $85.9 billion, according to Middle East Online Travel Overview by Phocuswright. Online travel bookings constitute 34% of this, signifying the growing prominence of digital platforms in travel bookings. Meanwhile mobile-direct revenue is estimated to represent 22% of all online bookings by 2021.
In comparison, Saudi Arabia’s travel market is worth $7 billion, out of which 14-15% is held by online travel agents. It is also a tech-savvy market that has shown a strong affinity to mobile bookings. According to Cleartrip, mobile reservations in the kingdom leapfrogged by 116% last year.
With such a strong potential, Crighton says that Cleartrip’s focus is going to continue within its core markets of Saudi and Egypt. Upon being asked whether the company is looking to complete any acquisitions, he said: “Not in the next 8-12 months. But there are quite a few good targets in that market, but we are not looking at them right now.”