MFS and S8 announce merger

MFS Limited (‘MFS’) has today announced a proposal to merge with S8 Limited (‘S8’), a vertically and horizontally integrated retail and wholesale global travel services group.

The transaction will in the first instance create a diversified group with a market value of approximately $1.7 billion.  The Merger will be implemented by way of an off-market takeover offer by MFS for all of the shares on issue in S8, which values S8 at approximately $700 million.

The Merger proposal has the unanimous support of the S8 Board, who intend to recommend the offer to S8 shareholders in the absence of a superior proposal.  All of the Directors of S8 have indicated, that in the absence of a superior proposal they intend to accept MFS’s offer in respect of their personal and associated shareholdings.

MFS Managing Director, Philip Adams, said the merger of MFS with S8 would give shareholders of both companies, as shareholders of MFS Limited, the opportunity to share in the significant growth potential of the merged business which will lead to substantially increased value over time.

Philip Adams said, “S8 has created Australia’s largest travel products distribution business, including the iconic Harvey World Travel, Transonic Travel, Travelscene and the recently acquired Gulliver’s in New Zealand. Harvey World Travel has demonstrated significant growth, including overseas operations and a UK joint venture with Virgin Travel. S8 also manages the letting of over 5,000 apartments in 48 resorts.”

“S8’s travel products distribution business will form the basis of a revolutionary vertically integrated international travel service company not only acting as a pure travel agent but also acting as a financial travel services provider providing ancillary products such as finance for holidays, foreign exchange, insurances, money transfers, and timeshare” said Mr Adams.

S8 Chairperson, Jenny Hutson, said, “Combining the MFS and S8 businesses will allow an acceleration of the growth of both companies.  Our shareholders will share in the benefits of industry growth.  S8 has positioned itself as a significant player in the travel industry in Australia and the pan-Pacific.  The S8 Board has carefully considered all the options for future growth and strongly believes the MFS offer presents the best opportunity for continued growth and success”.

“Chris Scott has demonstrated his commitment to the transaction by providing MFS with an option over 19.9% of the S8 shares. His vision for S8 has been instrumental in S8’s success.  He will ensure that in the event the proposed transaction proceeds that the businesses are brought together in a way that facilitates the optimal outcome for all stakeholders.”

The S8 Board have agreed that they will unanimously recommend to S8 shareholders that they accept the MFS offer in the absence of any superior proposal being received.  All of the directors of S8 have indicated they will accept MFS’s offer in the absence of a superior proposal. 

Following completion of the takeover, S8 Chairperson Jenny Hutson will be invited to join the MFS Board.