This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration. Need a new registration confirmation email? Click here
American Express Company (NYSE: AXP) today announced plans to create a joint venture designed to accelerate the transformation of its Global Business Travel (GBT) division. American Express is in ongoing discussions with regard to a proposed joint venture in which it would share the ownership of the joint venture with an investor group led by Certares, a firm headed by senior management with significant experience in the travel industry. It is expected that GBT’s operations, business relationships and other assets would be held and operated by the joint venture entity. The joint venture transaction is expected to create greater investment capacity for GBT to further enhance its suite of products and services, attract new customers and grow internationally to deliver additional value to customers.
As presently contemplated, American Express would maintain a 50% ownership stake in the joint venture, which would continue to operate under the American Express Global Business Travel brand, while an investor group led by Certares would own the remaining 50% interest. The investor group would invest a sum in the range of $700 million to $1 billion, which would be used by the joint venture to grow the GBT business. Subject to the execution of definitive agreements and receipt of requisite regulatory and other approvals, the transaction would be expected to close in the second quarter of 2014, at which time American Express would expect to recognize a gain.
It is also anticipated that GBT employees would transition to the new structure which, upon closing, would be managed by a board of directors that would include representatives appointed by American Express and the investor group, as well as selected independent directors. As the parties work toward completion of the transaction, the GBT management team will remain in place and focused on serving the needs of GBT’s business customers. American Express also expects to execute comprehensive commercial agreements to provide uninterrupted service and close coordination for mutual customers of GBT and American Express’ other business units.