Dufry has entered into a binding agreement with Edizione S.r.l. to acquire its 50.1 percent stake in World Duty Free S.p.A. Following completion of the transaction with Edizione, Dufry will launch a mandatory tender offer for the remaining 49.9 percent outstanding World Duty Free shares.
The purchase price for the controlling stake is €1.3 billion (US$1.4 billion).
The acquisition will expand Dufry’s position in the North America, as well as globally. Dufry gained a stronghold in the U.S. in 2008 when it purchased Hudson Group, and it expanded its presence in the region last year when it purchased Nuance Group.
The combination of Dufry, Nuance and World Duty Free will have operations in 67 countries and nearly 400 locations. Dufry’s market share of airport retail globally will rise to about 24 percent, the company estimates.
Dufry CEO Julian Diaz called the deal “the most important milestone in the history of our company.”
“The combined entity will have a very attractive concession portfolio, one of the best in terms of duration, rent to be paid and risk-diversification strategy,” Diaz said in a conference call announcing the deal.
Diaz also pointed to the group’s balanced exposure to the airports in developed as well as emerging markets, saying it will “create an upscale travel retail [company] with obviously the position of worldwide leader.”
With the World Duty Free purchase, Dufry expects to find synergies of up to 100 million euros in areas such as procurement, long-term relationships with landlords and others.
On a pro forma combined basis, once fully integrated and including planned synergies, Dufry would have generated a turnover of CHF 7.8 billion (US$8.06 billion) in 2014, the company said.
