Travelzoo Inc. (NASDAQ:TZOO) today announced that on August 20, 2015 it acquired the Travelzoo Asia Pacific business (“APAC”), which includes the Travelzoo® businesses in Australia, China, Hong Kong, Japan, Taiwan, and Southeast Asia. This business was independently operated by Azzurro Capital Inc. under a licensing agreement with Travelzoo Inc. The acquisition positions Travelzoo to tap into opportunities arising from the fast-growing number of Chinese outbound travelers and to bring even more travel and lifestyle offers to Travelzoo’s 27 million members around the globe.
Travelzoo Inc. held an option right to acquire APAC at fair market value as determined by a third party valuation expert. Travelzoo Inc. exercised its option right to acquire APAC using available cash and a promissory note of $5.7 million with a maturity date of three years. In 2014, APAC reported approximately $10.8 million in revenue.
Travelzoo Inc.’s board of directors established a special committee (the “Special Committee”), consisting of independent directors to determine whether the acquisition of APAC was advisable, fair and in the best interests of the company’s stockholders other than Azzurro Capital Inc., the principal stockholder of Travelzoo Inc. The Special Committee engaged an independent financial advisor to determine the fair market value of APAC to be used as the fair market value option exercise price and to issue a fairness opinion on the transaction. The Special Committee unanimously approved the acquisition of APAC at the fair market value option exercise price with the assistance of its independent legal counsel and independent financial advisor.