TAG Buys TraveLeaders, Targets Corp. Business

Travel Acquisitions Group has acquired Coral Gables, Fla.-based travel management company TraveLeaders from publicly held American Leisure Group for a cash payment of $6 million, plus an additional payment that may reach up to $8 million, according to filings with the London Stock Exchange. The TAG agency franchise network—formerly Carlson Leisure Group—will increase its focus on acquiring corporate travel agencies and small and midsize corporate travel accounts, said TAG chairman and CEO Mike Batt.

TraveLeaders is a 65 percent corporate agency and claims $223.3 million in sales through its nine agency locations in Florida, California and Ohio. The company also operates some onsite corporate travel operations in states including Alabama, California, Maryland and Texas. Last year, TraveLeaders claimed to Business Travel News 805 corporate accounts and said it booked 15 percent of ARC transactions online. In 2007, TraveLeaders earned a before-tax profit of about $1.7 million on revenue of $18.6 million, according to ALG. As of the end of February, TraveLeaders' net assets totaled about $427,000.

Alan Hale will take over as president of TraveLeaders from Birmingham, Ala.-based Adventure Travel, Adtrav Travel Management's leisure arm.

TAG was formed following a January management buyout of the former Carlson Leisure Group from parent company Carlson Cos. Last month, the company brought on Lehman Brothers veteran J.D. O'Hara as senior vice president of corporate development, charged with handling TAG's merger and acquisition activity. Batt said significant capital is available for acquisition growth for TAG and its franchisee network.

"Our former name was a bit of a misnomer, since we already have substantial corporate-oriented business," Batt said. "We've always been big in this space. For example, a major portion of TAG's ProQuest Travel Group's business is corporate-oriented, as it's the TAG company that acquired the former Caravelle Travel a few years ago and continues to serve a corporate clientele."

Carlson Wagonlit Travel Associates agencies, which sit in TAG's Travel Franchise Group, average 60 percent of their business from corporate accounts, Batt said. "By getting bigger in the corporate travel space, we'll be able to offer economies of scale to our franchisees and their clients. We want our corporate mix to be nearly identical to that of our franchisees," he said.