Navigant International Inc. and TUI Business Travel Deutschland GmbH today said Navigant will acquire the 50 percent share of global joint venture company TQ3 Travel Solutions owned by Maritz Inc., and that by May it will replace Maritz's corporate travel management company as TQ3's Canadian and U.S. partner. Now known as TQ3 Americas, the corporate agency owned by Maritz and headquartered in Fenton, Mo., is expected to be bought by Carlson Wagonlit Travel
(BTNonline, March 11). The deal creates the TQ3Navigant brand in North America as part of a global organization known as TQ3 Travel Solutions that claims a combined $11 billion in travel sales and 2,200 locations. Financial terms were not disclosed.
In announcing the arrangement, executives with Navigant and TQ3 extolled their views on how culturally similar and minimally overlapping the companies are, and how it improves TQ3's capabilities to service multinational firms as components of an "integrated offering." Then the TQ3 execs ripped into both Maritz and CWT.
Talking up the benefits of partnering with a larger North American entity, but stopping short of saying Maritz's corporate agency had not been pulling its weight, TQ3 managing director, global COO and global board member Toby Joseph said, "The majority of our multinational success up until this point has come elsewhere around the world." TQ3 president, CEO and chairman Marc Hildebrand said that partnering with "number six or five in the U.S. marketplace is, and I'll say it straight away, simply not good enough if you really want to be one of the top global players." He did not comment directly on whether TUI made a bid for the erstwhile TQ3 Americas.
Hildebrand said the new partnership was not a reaction to American Express' Rosenbluth acquisition
(BTN, Aug. 11, 2003), but he was eager to attack Carlson Wagonlit Travel, which last year bought TQ3's French partner: "If you look at CWT acquiring Protravel in France, I can only read that as an aggressive activity aiming at TQ3 with the objective to weaken TQ3. On the one hand, I can understand it because we have won hundreds of millions of business from Carlson Wagonlit over the past few years, so apparently they were not able to give the answers in the marketplace and that's why they started that kind of activity. Should something happen with CWT and Maritz, we're giving the right answer here, and I look forward to competing in the future, as TQ3 now is number two in the United States." Calling the Protravel buy "hostile," Hildebrand said, "I think our competitors' strategies to attack TQ3 have failed. TQ3 is stronger today than ever before, and now is in a position to attack everyone else in the most important marketplace in the world, and that is the U.S."
In France, meanwhile, "We're now up and running, and the doors will open for business midyear," said Joseph of TQ3's effort to build off a leisure operation and create a wholly owned corporate travel presence.
With the TQ3 deal, Navigant is addressing a longtime challenge in that its multinational offerings paled in comparison with its competitors'--which themselves are weaker than what many multinational corporate travel managers demand. "Our goal all along has been to put together what we felt was the strongest partnership or joining of companies," said Navigant chairman and CEO Ed Adams. "We have entered into different agreements over the past six years, but when this opportunity presented itself, clearly it was something we could not pass up." Adams declined to describe the outcome of recent talks between Navigant and the former Rosenbluth's foreign partners
(BTNonline, Oct. 14, 2003). He said it "goes without saying" that being part of TQ3 enables Navigant to pursue larger U.S.-based accounts. Adams was named co-chairman of TQ3 and will be joined on the global board by Navigant executives Gene Over and Bob Griffin. Navigant's share price today rose slightly.
As for existing TQ3 Americas accounts, Joseph said, "Over the next few months, we'll be taking a careful look on a client by client basis on what is the sensible transition and on, where appropriate, Maritz maintaining service under the requirements of the contract for the length of the contract. Our clients will decide, but we'll do everything we can to make sure seamless service is met."
Navigant said it operates 1,000 locations in 20 countries and U.S. territories, employing 4,200 associates. TUI Business Travel Deutschland's subsidiaries and affiliates claim 1,200 locations in 80 countries with 8,500 associates.