Prosus buys Despegar, the leading digital travel agency in Latin America, for US$ 1.7 billion

Prosus, an international technology company, announces the signing of a definitive purchase agreement for Despegar (NYSE: DESP), the leading digital travel agency in Latin America, for US$ 19.5 per share, which represents a 33% premium over the stock's closing price on December 20, 2024, and a 34% premium over Despegar's weighted average share price over the last 90 days. The proposed transaction was approved by Despegar's Steering Committee, which recommended that shareholders vote in favor of the proposed transaction by unanimous recommendation of an evaluation committee.

The transaction constitutes a considerable and significant expansion of Prosus's ecosystem in Latin America that, post-transaction, will serve a portfolio of more than 100 million customers in the e-commerce, travel, and fintech segments.

“This acquisition is a clear demonstration of our strategy to generate value by creating a complementary, high-quality business ecosystem. Despegar is a highly profitable company, with an attractive market position and a leadership team with extensive experience, which will naturally align with our operation in Latin America. We will accelerate Despegar's growth by leveraging the multiple touchpoints that exist with our portfolio, combined with our operational expertise and strong capabilities in AI,” said Fabricio Bloisi, CEO of Prosus Group.

“This is a promising growth opportunity that can generate great results for Despegar's shareholders. The financial terms of the transaction are of high value for our shareholder base, and I am convinced that Prosus is the ideal partner to drive us into the next phase of growth. For our customers, this means access to a broader portfolio of services, better experiences, greater loyalty benefits, and more comprehensive solutions tailored to their needs. Prosus has proven experience in developing technology businesses worldwide and possesses deep knowledge of the Latin American ecosystem that places them in an ideal position to accompany us in the next phase of the company's growth,” stated Damián Scokin, CEO of Despegar.

Despegar operates in more than 19 markets in Latin America, providing customer services through two main business models: an omnichannel B2C platform that connects with users via the internet, an app, and conversation channels led by Sofía, a virtual assistant created with AI, and a rapidly expanding B2B segment that offers general solutions for business partners such as banks, airlines, and retailers.

Over the past two decades, Despegar has become a sector leader with a proven and scalable business model. The company handles more than 9.5 million transactions per year, generating US $5.3 billion in gross bookings, US$706 million in earnings, with a reported EBITDA of US$116 million according to its total annual results for 2023.

Founded in Argentina in 1999, the business scaled and expanded in the region until it began trading on the New York Stock Exchange in 2017. Despegar became the most recognized travel brand in Latin America, and Decolar is its most recognized brand in Brazil, its largest market.

Prosus recognizes the significant potential of expanding its extensive consumer ecosystem in the region to drive the number of users and engagement of Despegar and, simultaneously, introduce new products and services that enhance the platform's value proposition over time.

Following this acquisition, Prosus plans to create synergies between Despegar and other regional businesses such as iFood, a leading delivery platform in Latin America with 60 million customers per year, and Sympla, a prominent event platform.

“Latin America is a market we know and understand well, with real GDP growth of 2 to 3% for next year and promising long-term projections. In addition, online travel is expanding significantly worldwide, and the opportunities in the Latin American region give us the confidence that we can work with Despegar to take the business to the next level. This investment will be a very good example of how we can generate value by integrating businesses into our ecosystem, driving growth, innovation, and creating a lasting impact,” added Fabricio Bloisi.

The transaction was executed in accordance with the typical terms and conditions for this type of operation and is subject to the usual closing conditions, such as the approval of Despegar's shareholder base and the approval of the relevant regulatory authorities, with an estimated closing date in Q2 of 2025. The purchase price will be settled with existing cash funds.

Morgan Stanley & Co. International plc acted as the exclusive financial advisor to Prosus in the transaction, and Davis Polk & Wardell LLP acted as legal advisor.