Helloworld Travel (ASX: HLO) is betting on heavy demand for cruises in 2022 after entering into an agreement to acquire Phil Hoffman-founded cruise wholesaling specialist CruiseCo today.
The travel distribution company has also announced the renewal of its partnership with Qantas (ASX: QAN) with a new three-year partnership signed today.
CruiseCo is a cruise package wholesaler founded 20 years ago by Phil Hoffman, Kevin Dale and Steve Lloyd.
The business was turning over around $70 million annually prior to the onset of COVID-19 from its member agents throughout Australia.
According to Helloworld the acquisitions aligns with the company's strategy of expanding its cruise offerings in Australia and New Zealand.
Further, HLO said CruiseCo would be complementary to its existing cruise wholesale business Seven Oceans Cruising, which prior to COVID-19 had annualised total transaction value (TTV) of approximately $110 million.
"These two businesses, when combined, provide Helloworld Travel with a comprehensive range of cruise options for our retail agencies in Australia and New Zealand," HLO executive director Cinzia Burnes said.
"Given the recent demand for some 2022 specials in the market, the positive news around both the development of a vaccine and rapid testing capabilities, we are confident that demand for cruising will come back strongly from 2022 and we look forward to working with our cruise partners and agencies to capture that demand."
The acquisition of CruiseCo will be funded from existing cash reserves and the purchase price is not considered material.
Helloworld has also renewed its partnership with Qantas signing a deal to sell the national carrier's fares and products until 2023.
Managing director Andrew Burnes said the long term agreement provides commercial certainty for Helloworld and its agency networks.
"We have had a longstanding partnership with Qantas and the continuation of that was an important component in securing our position as their leading travel agency partner and ensures our owned businesses and agency networks can continue to sell Qantas with confidence," Burnes said.
Shares in Helloworld are up 3.35 per cent to $2.78 per share at 11.55am AEDT.
Business News Australia
Get our daily business news
Sign up to our free email news updates.