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Amadeus in US$40m investment deal with MTN, Travelstart

Amadeus in USm investment deal with MTN, Travelstart.

Global technology investor Amadeus Capital Partners has announced that it is part of a US$40m investment in online travel agency Travelstart, together with mobile operator MTN.

Travelstart operates in South Africa, Nigeria, Egypt, Kenya and parts of the Middle East. The parties say the growth investment by Amadeus and MTN will enable Travelstart to enter new markets and extend its market dominance throughout Africa in response to strong demand from a rapidly expanding middle class with internet access.

Representing Amadeus Capital Partners Andrea Traversone expanded on the motives for the deal. "Our investment in Travelstart is among the largest venture investments in South Africa in the last five years. Africa has one of the fastest growing middle classes in the world that are fast adopting e-commerce and mobile internet access. These macro trends support Travelstart's growth and bode well for their strategic relationship with MTN. With this transaction, Amadeus has demonstrated its commitment to strong investment opportunities such as Travelstart that respond to these trends in emerging markets."

Travelstart was founded in Sweden more than fifteen years ago by CEO Stephan Ekbergh. It started its operations in Africa from its Cape Town headquarters in 2006. The company has since entered other emerging markets across the Middle East and Africa. The announcement of the agreement also reveals that the investment by Amadeus and MTN will be used to support the expansion of Travelstart into other markets, as well as growing its product offering. MTN will support Travelstart's expansion through its mobile network on the continent.

Ekbergh described the investment as timely and valuable to the company that he started. "Amadeus Capital's investment comes at an inflexion point for Travelstart, as we capitalise on a boom in online travel bookings across Africa and Middle East. Air travel in Africa is expected to grow significantly faster than in most regions globally, with a host of low cost carriers targeting the region."

Herman Singh, MTN Group Chief Digital Office says of the deal,"It strongly complements our existing investments in online and e-commerce in retail, marketplaces, classifieds and travel. This investment in the largest multinational player in a very large and rapidly growing market positions MTN as an enabler of exciting new leading edge businesses. The MTN footprint, subscriber base, payment capability, network and brand awareness strongly underpin the synergies already being manifested in our other investments. We look forward to working with Amadeus and the Travelstart team to accelerate the business development of this adjacency."

As a result of the development, Traversone and Ekbergh have joined Travelstart's Board of Directors. Travelstart's financial advisor for this transaction was EOC Partners LLP.

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