Hubert Joly
Hubert Joly is president and CEO of Carlson Wagonlit Travel, which last week announced its intention to buy Navigant International following a re-capitalization in which One Equity Partners would take a 45-percent stake in CWT as Carlson Companies increases its ownership to 55 from 50 percent. What follows are Joly's answers to five questions from reporters during two conference calls regarding the deals.
You said the One Equity Partners transaction "would not be complete without the CWT-Navigant transaction." Does that mean the first was predicated upon the second?
What I meant to say was that CWT's acquisition of Navigant is enabled by the support that we're getting from Carlson and OEP. Without them, we could not have done it. Accor was not going to invest in the space, and Carlson needed a partner to make the investment to acquire both the Accor stake and then Navigant. I was trying to highlight that we see the new shareholder structure as an asset, not just in theory but in practice ... the minute we announced the new shareholder structure, we make this big acquisition.
Does this change where some staff will be located, particularly yourself?
Accor is today, and has been, an owner of shares in Carlson Wagonlit. I note that France is a key market for us, as one of the largest business travel markets, so we will continue to have many people serving the French market, because in this industry you need to have locals serving locals, for the most part. Regarding our headquarter functions, in Paris we have both the European headquarters, which will not be affected, and we have a significant portion of our global functions in Paris. When you think about certain companies, particularly global service companies, you actually don't know where their headquarters are. Most people don't know [the location of headquarters for] Accenture or McKinsey & Company. So, in our case, the location of the headquarters is not that critical. Where will I live? I live in [airline seat] 2B. My family lives in Paris and I spend my weekends there, but these transactions do not affect the location of our headquarters.
One of the Navigant's regulatory filings indicated, "There will be layoffs." Can you say whether we can expect those to include travel counselors?
The one area where we want to be extremely careful, thoughtful and prudent is everything that touches the customer, and travel counselors are very much in that camp. There tend to be no duplicates in that area because, of course, all of them are busy serving customers with the growth of traffic we're experiencing. The overlap in these kinds of acquisitions tends to be more in the general and administrative functions rather than on the front line.
How important is ... market share?
Size is not a goal in and of itself in this industry. As leaders of this business, as we drive the business, we're very focused on understanding what the customers want and delivering what they are looking for, enhancing the quality of our transaction processing and program optimization of our services. We believe that, altogether, the industry should probably continue to consolidate because of the pressure on margins and the need for more economies of scale.
You talked about the "blue company we all know about," American Express. Does the planned 45 percent ownership of CWT by One Equity Partners--an investment affiliate of JPMorgan Chase--tell us anything about possible payment system partnerships for CWT? JPMorgan Chase offers a corporate T&E card. Can we imagine a marketing deal between the companies?
There's nothing to say on that today. One Equity is a separate part of JPMorgan, and that certainly has not been contemplated at this point.