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lastminute.com Pays $89 Million for Degriftour

[London, ENGLAND] European late deals company lastminute.com has paid US $89 million for Degriftour Group, France's largest e-travel company.

The takeover, announced Monday, makes lastminute.com the largest European-based e-commerce company, based on revenues.

Degriftour Group has been an online retailer since 1991 and has 50 percent of the French market, with a quarter of a million customers since April 1998. Its acquisition will transform lastminute.com's position in France and add substantially to its overall revenues.

Brent Hoberman, lastminute.com's chief executive, hailed it as "a great deal," and said it achieved today what his business plan would have taken two to three years to achieve in France.

"Our gross profit increases by almost nine times. Our top management is strengthened and it accelerates the time in which we become cash flow positive. This is a step jump in our ability to deliver the lastminute marketplace," said Hoberman.

lastminute.com will pay for its acquisition partly by issuing 19.7 million new ordinary shares and partly in the form of just over US $40 million in cash, of which $8 million need not be paid for a year.

Pierre Alzon, general manager of Degriftour Group, appeared well-satisfied with the deal, saying that it took the company closer to its long-term ambition of radically transforming the European online marketplace.

"We are delighted to have found a partner that is complementary in philosophy and vision and allows us to offer customers a unique global last minute solution," said Alzon.

A private company, Degriftour Group was owned 78 percent by its founder, Francis Reverse, and his circle of family and associates. Over 9 years it has built up relationships with major European travel and leisure suppliers, offering tours, tickets, meals and accommodation.

Degriftour Group transacted over US $75 million with gross profit of US $13.7 million for the year ended March 31, 2000.