Kuoni Group’s Board of Directors supports announced public tender offer by private equity company EQT

The unanimous decision of Kuoni’s Board of Directors follows a comprehensive review and assessment of all strategic options to create value for shareholders and to further the interests of the company. The Board believes that a take-private of the Kuoni Group under the ownership of private equity company EQT offers highly attractive benefits for its business partners and employees. The transaction enables Kuoni Group to further develop its position as a leading, focused and global travel services provider by investing in technology, in its enhanced service portfolio and in the acquisition of other businesses.

Kuoni has entered into a definitive transaction agreement with an affiliate of EQT, which will launch a public tender offer for CHF 370.00 in cash per registered B share. The planned transaction is to be implemented by a voluntary public tender offer. Today’s announcement follows a competitive process with EQT as well as a number of other interested parties over the course of several weeks.

As long-term investor, EQT will strengthen and expand Kuoni Group’s global business activities EQT is one of Europe’s leading private equity houses founded by Investor AB, Scandinavia’s largest industrial holding group and part of the Wallenberg Group. EQT is committed to invest in the continued development of the Kuoni Group in order to enable the company to grow and strengthen its position as a leading service provider to the global travel industry and governments and to further increase its profitability.

Group CEO Zubin Karkaria together with the current management team will continue to lead the company.

The operational measures announced in November 2015 to accelerate the implementation of the defined strategy will be carried out as planned in 2016. With the agreed public to private transaction of Kuoni Group, suppliers, customers and governments will continue to benefit from Kuoni’s innovative strength, its attractive service portfolio, investments in technology and the acknowledged quality of its global offerings. Existing business relationships will continue as before.

Heinz Karrer, Chairman of Kuoni Group’s Board, comments: “Over the last months the Board has very carefully analysed all strategic options in order to secure the successful implementation of Kuoni Group’s strategy. As a result of this detailed and comprehensive analysis and a competitive process, the Board concluded unanimously that taking Kuoni private and handing over the responsibility for the group to an internationally renowned new owner with comprehensive experience in managing and further developing industry leaders, with the necessary financial strengths and with a long term perspective would be the ideal solution to the benefit of all stakeholders. EQT fulfils all these requirements in the best possible way.”

Michael Bauer, Partner at EQT Partners in Zurich said: “EQT is proud of taking over the responsibility for the further successful development of one of the world’s leading travel services provider. We follow an industrial, long-term oriented approach when investing into companies to build sustainable market leaders. It is our ambition to enable the Kuoni Group to strengthen the market position of its businesses, both through organic growth and acquisitions, and to further increase the attractiveness of the Kuoni Group for clients, business partners and employees. This marks the starting point of a very promising era for Kuoni to continue to build successfully on its 110 years long journey.”

Zubin Karkaria, CEO of Kuoni Group: “We welcome EQT’s investment in the Kuoni Group, which underlines the attractiveness of our business activities. With the new owners we will be able to accelerate the implementation of our strategy. Investments in technology and supporting acquisition opportunities give the Kuoni Group an excellent platform to build further on its leadership positions in travel industry services. EQT has an impressive track record of growing companies. With access to their experience and network in both the travel and tech industries, we will be able to accelerate the implementation of Kuoni’s strategy.”

Kuoni and Hugentobler Foundation and EQT jointly guide Kuoni into the future The Kuoni and Hugentobler Foundation, Kuoni Group’s long-term anchor shareholder, welcomes the

Board’s decision and supports the public takeover offer from EQT. The Foundation continues to remain actively involved in Kuoni, in accordance with the Foundation’s purpose to ensure the long-term stability and integrity of Kuoni. Kuoni Group’s Board takes note that EQT and the Foundation have entered into a respective agreement on 1 February 2016. The joint management of Kuoni Group by EQT and the Foundation, the key pillars of Kuoni Group’s future development and the Foundation’s future involvement in Kuoni will be set out in this agreement. Key terms of the agreement will be disclosed in the offer prospectus.

Karl Hofstetter, Chairman of the Board of Trustees of the Kuoni and Hugentobler Foundation: “The strategy jointly targeted together with EQT for the sustainable development of the Kuoni Group is convincing and accords with the Foundation’s purpose. The Board of Trustees supports the takeover offer. We also reaffirm our intention to remain invested in Kuoni as long-term shareholder.”

Pre-announcement of binding offer from EQT to all shareholders of Kuoni Travel Holding Ltd The public tender offer is subject to a minimum acceptance threshold of at least 67% of Kuoni’s voting rights and more than 50% of its total share capital (with the inclusion of the shares held by Kuoni and Hugentobler Foundation), the deletion of the share transfer and voting right restrictions in the articles of association, to be approved by an Extraordinary General Meeting of the shareholders, which is expected to be held at the beginning of April 2016. In addition, the offer is subject to the approval of the merger control authorities and other customary conditions as well.

The pre-announcement of the tender offer has been issued in the electronic media today. Further information on this offer is expected to be published on 22 February 2016. On the same day the offer prospectus is scheduled for publication. The acceptance period for the public tender offer is expected to commence on 8 March 2016 and to end on 6 April 2016. The Board has agreed to resign in case of the success of the public tender offer. Subject to successful completion of the offer, it is intended that Kuoni will delist its shares from the SIX Swiss Exchange. In the light of these developments, the ordinary Annual General Meeting of Shareholders announced for 26 April 2016 will not take place and will be moved to a later date. Any dividend declared at such later 2016 Annual General Meeting of Shareholders will be deducted from the offer price. If the offer is successful, completion of the transaction and delisting from the stock exchange (SIX: KUNN) is expected in the 2nd or 3rd quarter of 2016.

Operational measures to accelerate the implementation of the strategy progress as planned
The operational measures announced in November 2015 are unchanged and the implementation progresses according to the previously announced plan. The GTS Division is being restructured in 2016; group and support functions are being adjusted. The GTD Division is focusing on improving margins and introducing new tools and services to give customers easy access to travel services. VFS Global will continue to innovate and to invest in technology and services to further enhance its successful visa business and additional services. In connection with the strategic review and the announced public offer, Kuoni Group was advised by Credit Suisse and Morgan Stanley as financial advisers and Homburger as legal advisers.

About Kuoni Group
Kuoni Group (Zurich Stock Exchange SIX: KUNN) is a leading service provider to the global travel industry and governments with leading positions in its areas of activity and sustainable growth prospects, with a strong focus on Asia. Kuoni Group generated turnover of CHF 3.4 billion in the 2014 financial year and employed about 8’000 people (FTE) at the end of 2014.

Kuoni Group focuses on three core activities:

Global Travel Distribution (GTD) is an industry pioneer and a highly experienced, leading global distributor that provides travel companies with easy access to hotel accommodation and destination services. It sells approximately 38,000 room nights per day online. More than 40% of its turnover is sourced from fast growing markets in Asia, the Middle East and Africa markets.

Global Travel Services (GTS) sources and coordinates destination services – from accommodation, transportation, tours and activities to venues and event management. GTS is the number one player in the growing group travel market and handles 50,000 leisure tours per year. GTS generates 60% of its turnover from Asia/Pacific source markets.

VFS Global, the industry pioneer and world’s leading visa services provider, works for 48 governments, operates 1,837 application centres in 122 countries and holds an estimated 50% market share of the global outsourced applications market. It generates almost 70% of its turnover from applicants from the Asia/Pacific region.

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