FLIGHT Centre Travel Group (FCTG) has acquired cruise business Iglu to accelerate its growth in the sector. The United Kingdom-based online travel agency will change hands following a 100 million upfront payment, with an additional 27 million in performance-based earnouts possible – the acquisition will be funded through cash and...
FLIGHT Centre Travel Group (FCTG) has acquired cruise business Iglu to accelerate its growth in the sector.
The United Kingdom-based online travel agency will change hands following a 100 million upfront payment, with an additional 27 million in performance-based earnouts possible – the acquisition will be funded through cash and existing debt facilities.
FCTG said the purchase adds a scalable digital platform with omni-channel capabilities to the company’s global network, as well as broader access to the UK, which is the world’s third-largest cruise market.
The company has been heavily investing in both the cruise sector and the UK market, acquiring another online-based business, Cruise Club UK, just over 12 months ago (CW 30 Oct 2024).
Annualised cruise-related TTV for FCTG is now predicted to top $2 billion during FY26, two years ahead of schedule.
Iglu has an attractive margin profile, boasting a 3.1% FY25 EBITDA margin versus 2.2% across FCTG’s leisure division.
The OTA currently captures more than 15% of British cruise bookings, and more than 75% of online bookings.
FCTG also expects the acquisition to increase its buying power, deliver immediate shareholder benefits, and be EPS-accretive in FY26, with further synergies and “strong growth potential” available in the medium-term.
“This acquisition delivers immediate shareholder value through EPS accretion and is a game-changer in terms of the future opportunities it unlocks in the global cruise market,” FCTG Managing Director Graham Turner said.
“Iglu brings a strong brand and a scalable technology platform that aligns with [FCTG’s] strategic objectives,” he added.
A circa 3% increase to $315 million-$350 million is expected for FCTG’s profit guidance this year, to reflect Iglu’s contribution to underlying profit before tax.
Cruise is one of FCTG’s fastest-growing leisure sectors, with sales increasing 15-20% year-on-year.
This is thanks to a resilient customer base and a supply chain with heavy investment. MS
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