Sabre Buys All of Abacus in Bid to Profit From Strong Asian Travel Growth

NEW YORK (The Deal) -- Travel and tourism software company Sabre (SABRsaid Thursday it will pay $441 million to acquire all of Asian airline and hotel technology company Abacus International.

Shares of Sabre, which is backed by Texas Pacific Group and Silver Lake Partners, gained 41 cents, or about 1.6%, to $25.91 on Thursday.

Sabre currently owns 35% of Abacus, while the rest is owned by a consortium of Asian airline partners. It will purchase the remaining portion of Abacus for net cash consideration of $411 million, the company said in a news release.

Sabre CEO Tom Klein said in the news release that the Asia-Pacific region is the fastest-growing travel market in the world.

With the deal, Sabre continues to gear its operations toward airlines, hospitality and travel groups. In September, the Southlake, Texas, company bought Genares, which develops software to manage hotel reservations systems, marketing and other business functions. The company bought airline data company PRISM in 2012.

Abacus provides data, e-commerce and other services to more than 100,000 travel agents throughout Asia. The company distributes information about airfares and hotel deals, operates booking systems and provides other services to the travel industry. Sabre expects the purchase to boost 2016 sales by $300 million and add $50 million in earnings before interest, depreciation, taxes and amortization.

In addition to Sabre, Abacus' current owners include All Nippon Airways, Cathay Pacific (CPCAY), China Airlines, EVA Airways, Garuda Indonesia, Dragonair, Philippine Airlines, Malaysia Airlines, Royal Brunei Airlines, SilkAir and Singapore Airlines (SINGY).

Sabre was formerly the technology group of American Airlines (AAL). The airline spun off Sabre in 2000.

TPG Capital and Silver Lake took Sabre private in 2007 through a $5 billion leveraged buyout. The firms took Sabre public through a nearly $630 million initial public offering last year.

TPG and Silver Lake control close to 69% of Sabre. TPG holds 32% outright and Silver Lake has close to 20%. A jointly managed entity called Sovereign Co-Invest holds nearly 17%.

Sabre provides data, transaction processing and other services to Abacus, and the parties previously had a joint venture called Sabre Pacific. In 2012, Sabre sold a 51% of the joint venture to Abacus for $46 million.

As Sabre has geared its operations towards travel businesses, it has exited consumer-focused operations. The company sold Travelocity.com to Expedia (EXPE) for $280 million in January, and shed European travel site lastminute.com in a $120 million sale to Bravofly Rumbo Group in mid-December.

Sabre expects to close the deal in the third quarter.

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