Fairfax Limited has bought Occupancy Pty Limited, operators of two leading Australian holiday accommodation booking web sites- rentahome.com.au and takeabreak.com.au for $29million.
Occupancy’s web-sites will become part of Fairfax’ Stayz.com.au holiday and accommodation booking business.
Fairfax claims that Stayz already handles 10% of all holiday rental bookings in Australia, and industry analyst – Tim Hughes – is reported as calculating the deal with Occupancy will see Stayz holding more than 60% of the market.
(Yahoo 7’s Totaltravel.com.au service and the Realestate.com.au owned realholidays.com.au service are thought to rank number 2 and 3.)
Occupancy’s Sydney based co-owners, Justin Butterworth, Craig Davis, Michelle Davis and Penny Parsons are to get $17.9 million in cash from Fairfax and $11.2million worth of shares in the Stayz business.
A Fairfax statement on the deal released earlier this month said that Occupancy’s co-owners will have around 10% of the shares in Stayz.
This suggests that Fairfax values Stayz at some $110million, which is a considerable jump on the $14.3million it paid for the business back in 2005.
Nevertheless, with a claimed 27,000 property listings and some 800,000 accommodation nights booked ever year, Stayz is a real success story for Fairfax.
Jack Matthews, CEO of Fairfax Metropolitan Media division, said that the acquisition continues the company’s strategy of building strong businesses in so-called ‘niche’ or specialist market segments.
“Stayz has been a great success story for Fairfax. We know the holiday rentals sector well and Occupancy will bring new areas of growth to our business.”
Occupancy two web-sites are said to have nearly as many property listings as Stayz, and only around 20% less unique users every month (more than 800,000).
However the company’s owners have nowhere as near deep pockets as Fairfax.
Nor do they have the same opportunities for cross-promotion and marketing as does Fairfax with its various newspapers, magazines and online services.
Indeed the logic of industry rationalization is believed to have been at least part of the reason why, last year, Butterworth and his rentahome business joined forces with Davis’ and Parsons and their takeabreak.com.au business.
The businesses earn their main revenues from an 8% commission paid by property owners on every booking .
Many property owners also pay for upgrades to their free, basic listing.
The businesses also earn advertising revenues, and rentahome, in particular has won a string of awards since it was founded in 1999.
Fairfax Digital Executive, Nic Cola, said that there was surprisingly little overlap between the listings of Occupany’s sites and those of Stayz.
“Rentahome has more metropolitan listings and accommodation bookings from corporate, including quite a surprising level of international bookings.”
“Takeabreak has traditionally been more of a holiday accommodation service.
He said that the lack of overlap was part of the reason why Occupancy is such a good fit with the Stayz business.
Cola sai that Fairfax believes that online bookings of holiday accommodation is an areas with tremendous potential growth.
“Ïts only very early days yet and we’ve only just scratched the surface.”
Justin Butterworth and Craig Davis share that view.
“We’re excited to join Fairfax and we strongly believe this partnership will take holiday rentals to the next level. It’s a win for accommodation owners, managers and travellers” they said.
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