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South Africa: Online travel agency lands $40m investment

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Stephan Ekbergh, Travelstart founder and CEO
Stephan Ekbergh, Travelstart founder and CEO
Amadeus, the global technology investor, today announced a $40m investment in Travelstart in partnership with MTN, Africa’s leading mobile and digital life services operator. Travelstart is the leading online travel agency in Africa, and has built a market leadership position in South Africa, Nigeria, Egypt, Kenya and parts of the Middle East. The growth investment by Amadeus and MTN will enable Travelstart to enter new markets and extend its market dominance throughout Africa, as the online travel agency responds to strong demand from a rapidly expanding middle class with internet access.

Travelstart was founded in Sweden in 1999 by its CEO Stephan Ekbergh. Operating in Africa from its Cape Town headquarters since 2006, Mr Ekbergh has built Travelstart into the market leader in South Africa, with over 75% market share. The company has since entered other emerging markets across the Middle East and Africa, achieving revenues north of $200m in 2015, and market leadership positions in Nigeria, Egypt, and Kenya. The investment by Amadeus and MTN will support the expansion of Travelstart into other key markets, as well as the growth of its product offering. The company will also develop a strategic partnership with MTN, who will support Travelstart’s expansion through its unrivalled mobile network in Africa.

Andrea Traversone, Partner at Amadeus, who led the investment, said: “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.”

Stephan Ekbergh, Founder and CEO, Travelstart, commented: “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. Alongside the strategic partnership with Africa’s best connected mobile operator MTN, Amadeus’ investment and guidance will prove invaluable in continuing to build our market leading position.”

MTN Group Chief Digital Officer, Herman Singh added: “MTN’s vision is to Lead the Delivery of a Bold New Digital World, and this investment in partnership with Amadeus is a key step on a multi-year journey to achieve that promise. It strongly complements our existing investments in online and e-commerce in retail, marketplaces, classifieds and travel. This investment in the largest multi-national 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.”

Staff writer

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