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Yatra-TRTL Reverse Merger

Gurgaon based Yatra.com is an Indian online travel agency and a travel search engine , founded by Dhruv Shringi, Manish Amin and Sabina Chopra in August 2006. Yatra.com has made four acquisitions till now—ticket consolidator Travel Services International (TSI) in October 2010, global distribution system (GDS) provider MagicRooms.in and Indian events and entertainment portal BuzzInTown.com—all for undisclosed amounts and 100% Stake in Travelguru.com.

Recently it has entered into a merger agreement with Terrapin 3 Acquisition Corp (TRTL).The transaction values Yatra at an enterprise value of $218 million (Rs 1,458 crore).Yatra said that it intends to be listed on the U.S. stock exchange Nasdaq under the symbol ‘YTRA’. It would be able to do this via a reverse merger, a way for private companies to go public, typically through a cost-efficient and expedient process. In a typical reverse merger, an active private company takes control and merges with a dormant public firm or a shell company.

the agreement states terms under which the current shareholders of Yatra will own at least 35% of the combined company and the first $100 million from Terrapin will be used to fund the combined company and pay transaction expenses.

Terrapin is a special purpose vehicle (or a company formed for a specific purpose). It was created expressly to facilitate a transaction such as this reverse merger. It will effectively cease to exist after the reverse-merger, which is a term used to describe the acquisition of a listed company by an unlisted one to facilitate listing minus the hassles of an initial public offering (IPO). Terrapin is currently listed on Nasdaq.

The cash infusion is critical for Yatra, for competing with its local rivals including India’s biggest online travel operator MakeMyTrip Ltd in which China’s Ctrip.com agreed to invest $180 million in January. The latest transaction will allow Yatra, which was reported to be in talks with Paytm (owned by One97 Communications Ltd) for a stake sale, to provide a partial exit to some of its shareholders. They will make a maximum of $80 million from the deal, according to the agreement.
Promod Haque, senior managing partner at Norwest Venture Partners.

“We are delighted to have TRTL on board in combination with Yatra. This transaction will provide Yatra with significant resources to further strengthen its presence as one of the leading players in the fast growing Indian online travel market.”

This reverse merger will play a major for Yatra.com and its future success.


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