American Express Global Business Travel Agrees US$5.3 Billion Deal with Apollo

(08 Dec 2021)  American Express Global Business Travel (GBT) has entered into a definitive business combination agreement with special purpose acquisition company Apollo Strategic Growth Capital (APSG).

The transaction implies a pro forma market capitalization of approximately $5.3 billion and a pro forma enterprise valuation of approximately $5 billion for GBT, assuming there are no redemptions by APSG’s shareholders.

Current GBT common equity holders are expected to roll their existing equity holdings into the combined company.

The transaction is expected to provide up to approximately $1.2 billion in gross proceeds, comprised of APSG’s approximately $817 million of cash held in trust and the upsized $335 million fully committed common stock PIPE financing.

Virgin Atlantic Airbus A350-1000 reg: G-VPOP. Picture by Steven Howard of TravelNewsAsia.com

Zoom Video Communications; Sabre; Apollo; Ares Management Corporation; and investment adviser HG Vora, are among a new group of strategic and institutional investors committed to joining GBT’s upsized, oversubscribed PIPE.

In addition, GBT has obtained commitments for an additional $1 billion term loan facility to be established under its existing credit agreement to repay approximately $600 million of certain existing term loan facilities and to provide an incremental $400 million of financing for general corporate purposes, including to backstop potential redemptions.

Both GBT and APSG boards of directors have approved the proposed transaction, which is expected to be completed in the first half of 2022 subject to the satisfaction of customary closing conditions, including approval of the business combination by APSG’s shareholders and certain regulatory approvals.

Upon the closing of the transaction, the combined company will be renamed Global Business Travel Group, Inc. and will continue to conduct its day-to-day business under its existing name and brand American Express Global Business Travel. The Expedia Group and Certares will join American Express Company as shareholders.

The company plans to list on the New York Stock Exchange under the new ticker symbol GBTG.

Paul Abbott, GBT’s Chief Executive Officer, said, “Becoming a public company will be a historic milestone on GBT’s growth journey. Commitments from new investors like Zoom, Sabre, Apollo, Ares and HG Vora are a huge vote of confidence in our business and the future of business travel, and meetings and events. We expect that becoming a listed company will give us the additional investment capacity to strengthen our commitment to providing unrivaled value, choice and experiences to our customers and partners.”

Under an 11-year agreement to take effect upon closure of the transaction, GBT will continue to have the right to use the American Express trademark in connection with the American Express Global Business Travel and American Express GBT Meetings & Events brands.