East Rutherford, NJ - September 4, 2008 - Hudson Group has signed an agreement to merge with Dufry, the global travel retailer based in Basel, Switzerland. Since December 2007, Hudson has been majority owned by the Boston-based private equity firm Advent International. Hudson and Dufry are both portfolio companies controlled by Advent.
The transaction, which is subject to regulatory approvals, will include an exchange of shares of Hudson Group's common stock into Dufry equity. Following the transaction, Advent, which manages separate funds which control Travel Retail Investments SCA (TRI), the controlling shareholder of Dufry, will continue to control Dufry. Dufry will directly own 100% of Hudson.
Hudson Group is the premier travel retailer in North America, with 540 duty-paid stores in 70 airports and transportation terminals throughout the United States and Canada. The merger will give Hudson and its Hudson News brand a new global presence. The transaction will also reinforce Dufry's leading position in travel retail and strengthen its position in the duty-paid segment of the industry. The combined company will operate more than 1,000 stores in 137 airports and will generate over $2.2 billion in revenue.
Joseph DiDomizio, President and CEO of Hudson Group, noted: "We are very happy to team up with Dufry's global operations. As a result of today's announcement, Hudson and its partners and customers will have access to highly desirable international specialty and designer brands from over 1,000 suppliers worldwide. This transaction also provides Hudson with enhanced geographic diversification almost immediately, as the successful Hudson brands and business model will be replicated all over the world, including newsstands and specialty retail stores. Finally, the alignment with Dufry will provide a new source of funding for growth initiatives and investment in our existing facilities. We are excited at the prospect of working alongside Dufry's superlative management team to create the world's pre-eminent travel retailer."
Hudson will become a wholly owned subsidiary of Dufry, with its current management team remaining intact. Hudson will continue to work closely with its airport authorities and other landlords, and there will be no change in the current setup for Hudson's existing business.
As for the strategic development of Dufry in terms of the duty paid segment, Dufry intends to build on Hudson's highly recognizable Hudson News brand, rolling out Hudson's business model internationally over the next three to four years. In the first phase, Dufry will focus on airports, where it already operated similar duty paid concepts or where it has a significant presence in duty free retailing, hence leveraging its existing infrastructure and organization.
Julian Diaz, CEO of Dufry, commented: "We are delighted about this transaction - Hudson sets the standard in duty paid travel retailing. The combination of Hudson's retailing expertise and Dufry's know-how in international markets and global footprint are a perfect match to create a duty paid news and convenience store concept on an international scale. Hudson even generates higher returns in duty paid than the average duty free operation, thanks to its focus on travelers' needs. For Dufry, this transaction is a great opportunity to build up a strong position in the duty paid convenience store segment, which complements Dufry's duty free business at a similar profitability."