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FLIGHT Centre Travel Group (ASX:FLT) has invested in a Gold Coast-based travel retailer to bolster its presence in the leisure market.
The Brisbane-based business acquired a 49 per cent stake in Ignite Travel Group, which specialises in curated holiday packages, travel vouchers and reward programs, for an undisclosed amount.
2012 Gold Coast Young Entrepreneur of the Year Randall Deer (pictured) founded Ignite in 2005, with the business expected to tip $100 million in total transaction value in FY17.
Flight Centre managing director Graham Turner says the deal will open new distribution opportunities for the company, as well as fast-track Ignite's growth.
"Ignite has innovative consumer products and distribution models with strong potential across its core business units in Australia and overseas in the future," Turner says.
"In particular, we see strong and rapid growth opportunities for the Exclusives voucher business, which operates in a market that is exciting and growing rapidly."
Ignite will continue to manage its three businesses MyHoliday Centre, RewardsCorp and Holiday Exclusives from its Broadbeach head office.
The partnership will initially focus on exclusive limited time travel voucher deals that allows customers to be able to redeem online and instore, with Ignite managing fulfilment.
Following the deal's completion, managing director Deer will chair a four-person board comprising two Flight Centre executives and an additional Ignite representative.
Deer says Ignite's customers and suppliers will reap the most benefits of the partnership as the company expands.
"We're always looking for ways to deliver on our supplier's objectives to increase incremental visitors, length of stay and spend and this partnership is a fantastic fit, while allowing us to maintain our exclusive supply chain relationships," he says.
"Flight Centre is an incredible business with unmatched market penetration. This landmark deal will massively increase distribution and access to new customer segments for our suppliers, giving them incremental business at times when they need it in addition to offering customers new and exclusive holiday deals."
Flight Centre will use general cash to fund the acquisition, with provisions in place to extend its holding in the future based on results.
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