I have been looking around for an internet based company that could be the leader in its service field - and so reap the rewards.
WEB (webjet.com.au) came to my attention on Friday and after doing some quick research I was very pleased by their latest results.... I don't know if anyone has used them - but their competition seem to be;
- travel.com.au (TVL)
Has anyone used any of these - what was their experience??
Well anyway, back to the saga.... Webjet's largest shareholder is Harvey World Travel (HWT) with 19%. On a quick look at HWT’s business they seem generate most of their income through franchising their agencies. The number of company owned agencies has been decreasing as they have moved to franchising.
Webjet is currently making a profit and has spare cash, further to this HWT has an option to increase its holding to 34% of issued shares at a discount to current price (without triggering a takeover – don’t ask me how this works). If HWT were to exercise this option at the current price, we are talking many million more going into webjets business, cashed up and ready to expand!!. Webjet would then be a very significant part of HWT existence (already is) and would effectively be the companies bet on the future of the travel agency business.
HWT announced on Friday it was looking into its holding and option in webjet (read – it is looking to exercise) both WEB and HWT’s prices rocketed up late last week. Whether HWT would actually proceed with a full takeover is ?? as webjet would not be attractive to anyone else with HWT’s holding and options.
Now to throw something else into the mix, SEL an ASX listed company that says its involved in property management and services has today announced a takeover bid for HWT at $1.85!!! (14% above Friday’s close) ….
Well I think that about wraps it up.
1) I wouldn’t want to touch a HWT franchise agency
2) How will flight centre react?