<B> Inside Track</B>
<B>Amadeus To Go Public</B>
After months of research, Amadeus' shareholders decided last week to proceed with an initial public offering by the end of the year. The shares will trade on the Madrid Stock Exchange, though what percent of the global distribution system they intend to sell has not yet been set. Amadeus is owned by Air France, Iberia and Lufthansa German Airlines, each holding a 29.2 percent share, and Continental Airlines, with 12.4 percent. Warburg Dillon Read and Merrill Lynch have been hired as joint global coordinators of the proposed IPO.
The decision to go public was expected following the stunning success of other travel technology IPOs over the past two years, including The Sabre Group and Galileo International. The Sabre Group sold 17.8 percent of the company, raising $627 million in October 1996, while Galileo sold 35.1 percent, bringing in $900 million in July 1997. As of last week, Sabre shares were trading over $40 while shares of Galileo fluctuated between $38 and $45.
<a name="story2"><B>Amex: Travel Costs To Rise 6-7 Percent For 1999</B>
American Express' 1999 corporate travel budget forecast, to be released in early September, will predict an overall increase of 6 to 7 percent in travel costs for the average corporation maintaining its current travel patterns. When completed, the study will offer detailed breakdowns of projections for each sector, including air, hotel, car rental and meals--all of which have been weighted and included in the 6-7 percent figure, said spokesperson Melissa Abernathy. (For more on budgeting for 1999, see page14.)
<a name="story3"><B>Airline Tardiness At Record High</B>
Airline ontime performance has plummeted in 1998, said the Air Transport Association's chief economist David Swierenga. Between January and June, the number of delays of 15 minutes or more averaged 960 per day, compared with averages of 672 in 1997, 744 in 1996 and 649 in '95. "This tremendous increase in delays is scary," said Swierenga, speaking at the NBTA convention in Orlando earlier this month. "We see this as a growing problem necessitating improvements in the air traffic control system."
<a name="story4"><B>Multi-Airline E-Ticket Machines In The Works?</B>
Northwest Airlines vice president of distribution planning Al Lenza told BTN the next step in airport passenger processing may be electronic ticketing kiosks that serve more than one airline. "We are discussing the idea with other airlines, particularly Continental," Lenza said, referring to Northwest's pending alliance partner. "These multi-airline machines would be similar to ATMs serving several banks and could justify placing them in smaller markets."
Lenza noted that Northwest's devices--which also handle seat assignments, upgrades and flight changes--are used by about 20 percent of e-ticket holders. Overall, Northwest e-ticketing has reached 45 percent of all tickets sold, growing at a rate of about 1 percent per month.
<a name="story5"><B>BTC's Third Summit Planned for October</B>
The Business Travel Coalition announced a third Airline Competition Summit, scheduled for Oct. 20 in Chicago. Designed for "corporate, community and airport executives attempting to identify strategic solutions to airline competition problems," the Summit will examine three main issues: airline industry competition levels with a focus on the Department of Transportation's proposed Enforcement Policy Regarding Unfair Exclusionary Conduct in the Air Transportation Industry; market intervention strategies such as the Chrysler/GM-Pro Air transaction (<I>BTN,</I> June 22); and group purchasing and lessons learned from the Business Travel Contractors Corporation group purchasing initiative. Attendance will be limited to the first 225 registrants.
<a name="story6"><B>Omega Continues Search For Low-Cost Res Options</B>
Omega World Travel is getting ready for phase two of its Greenwood prison reservation center (<I>BTN,</I> Sept. 8, 1997). It went live in January, but as yet has no corporate business. Separately, Omega will open a 500-person res center for large corporate accounts in Jacksonville, N.C., in January. Omega also will be the first customer for MegaTel III, a speech recognition tool for the reservation process that responds to customers' telephone requests by faxing six departure and return options.
<a name="story7"><B>HoJo Shatters Hotel-Industry Glass Ceiling</B>
Parsippany, N.J.-based Howard Johnson appointed Mary Mahoney president and CEO, making her the first woman to head a major hotel brand. Mahoney, 38, was promoted from vice president of marketing. She has served more than 18 years in the lodging industry.