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With today’s news a new travel retail supergroup is born |
INTERNATIONAL. Autogrill today underlined its ambitions to become the dominant global airport retailer and food & beverage provider, following the news that it has acquired World Duty Free and the remaining 49.95% of Aldeasa for a combined enterprise value of €1.07 billion.
The company said it was creating a new “global travel service company” with sales of €1.68 billion combining World Duty Free, Aldeasa and Alpha Group’s tax and duty free business.
Speaking to analysts and media this morning, Autogrill CEO Gianmario Tondato Da Ruos said the company was intent on creating a “a new game” in the global airport services market. He expects the combined travel retail business to soon be worth €2 billion with the integration of World Duty Free, Alpha and the remaining stake in Aldeasa.
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“We will have “dual leadership” in the food & beverage and travel retail markets.“ |
Gianmario Tondato Da Ruos Chief Executive Officer Autogrill |
In 2007 World Duty Free reported gross revenues of £445 million, net revenues of £420.5 million and Ebitda of £37.4 million.
The new supergroup will be the dominant player in Europe, with estimated sales of €1.44 billion, said Autogrill. The UK traveller will become a particular focus, it said, and World Duty Free and Aldeasa would be able to target passengers at their origin and destination airports.
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Autogrill underlines the strength of its ambition |
Aldeasa CEO José-Maria Palencia Saucedo (an important influence in the deal), who was also speaking at the analyst and media conference, said: “World Duty Free will add volume to the business, in liquor and in perfumes & cosmetics in particular. With Alpha and World Duty Free we have the opportunity to reach those passengers twice. And we plan to explore how we can do this immediately, even for the summer period ahead.”
The company will also look beyond Europe, added Tondato Da Ruos. “With market leadership in Europe and Heathrow and Madrid among other locations, we’ll understand the needs of non-EU passengers better. We will also have “dual leadership” in the food & beverage and travel retail markets. That will help us accelerate our development in emerging markets. There will be sales synergies, the same customers, the same landlords.”
Tondato Da Ruos said he would be “surprised” if the company went back to the market in the short term to seek further acquisitions, though he did not rule it out.
“In the past 12 months we have made two important acquisitions plus added the remaining 50% of Aldeasa, and we’re now seeking €40 million in synergies by 2011, so you can expect we will be focused on achieving the integration quickly and on achieving the best business model possible. I’d be surprised if we went back to the market so quickly but we will remain flexible.”
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“World Duty Free will add volume to the business, in liquor and in perfumes & cosmetics in particular.“ |
José-Maria Palencia Saucedo Chief Executive Officer Aldeasa |
The company also said it was “very confident” about extending the terms of its 12-year concession for World Duty Free at BAA’s UK airports.
Tondato Da Ruos said: “We cannot disclose any more details of the contract than we already have, but I am very optimistic that we will be able to extend it beyond the current time.”
Autogrill estimates that Ebitda among its travel retail operations is €150 million today (based on 2007 figures at the individual companies). By 2011 it expects this to hit €220 million.
MORE STORIES ON THE SALE OF WORLD DUTY FREE
Autogrill wins race for World Duty Free in blockbuster US$1.1billion deal- 09/03/08
Decision imminent on World Duty Free as three front-runners fight it out – 06/03/08
Lagardère Services Chief Executive confirms offer for World Duty Free – 05/03/08
Crunch day for World Duty Free – 03/03/08
Autogrill secures €1 billion in financing to fund “˜potential acquisitions’ – 28/02/08
New debt and equity to finance Dufry’s bid for World Duty Free as deadline looms- 28/02/08
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