MakeMyTrip Sets $3B Share Buyback in Motion, Cutting Ties with Trip.com

Online travel aggregator (OTA) MakeMyTrip (MMT), which is listed on the Nasdaq, will repurchase shares from its Chinese investor Trip.com Group Limited for around $3 billion.

Trip.com announced that it has modified its share repurchase arrangement with the Indian travel tech company on June 23 in a filing with the US Securities and Exchange Commission (SEC).

In accordance with the restated agreement, MMT will purchase the interest for the sum described above. According to the filing, MakeMyTrip will pay roughly $3 billion as consideration for the aforementioned repurchase under the terms of the restated and revised share repurchase agreement that was made between the company and MakeMyTrip.

Trip.com anticipates that the deal will be finalised by the beginning of July 2025. Following the repurchase agreement, the Chinese company stated that it will continue to own approximately 16.90% of MakeMyTrip's issued and outstanding shares.

MMT’s Strong Push to End Ties with the Chinese Firm

This comes weeks after the OTA, which is listed on the Nasdaq, initially announced that it would raise money through a main offering and senior notes in order to repurchase its interest from Trip.com Group, a Chinese investor.

 MMT then raised $3.1 billion last week to buy back some of its Class B shares from Trip Group. Initially, it was anticipated that MakeMyTrip would offer 14 million main shares as part of the fundraising transaction.

However, the business later raised this figure to 18.40 million shares at $90. The Chinese investor will remain the largest minority shareholder in the travel tech company based in Gurugram, even after lowering its stake to 16.9%.

EaseMyTrip Co-founder alleging MMT of Exposing Data

A month after Nishant Pitti, a cofounder of EaseMyTrip, said that the travel tech business may reveal the information of Indian soldiers who use the platform because of its Chinese ownership, MMT accelerated the buyback agreement.

MMT, however, denied the accusations and called them "malicious". The dispute between India and Pakistan following the Pahalgam terrorist assault was the setting for the altercation between the two domestic travel technology giants.

Notably, Moshe Rafiah, cofounder and CEO; Rajesh Magow, founder and chairman; Deep Kalra; and four Chinese members currently make up MMT's board.

Current Financial Dynamics of MMT

Gains from a tax credit and the valuation of convertible notes propelled MakeMyTrip's reported profit increase to US $171.9 million in the March 2024 quarter.

According to MakeMyTrip, the business made US $5.4 million in the same quarter of the prior fiscal year. According to the statement, the fourth-quarter result included a one-time gain of US $30.6 million from the change in the carrying value of the company's convertible notes due 2028, calculated at amortised cost, and a one-time credit of US $126.1 million from the recognition of deferred-tax assets.

The gross bookings for the quarter came to US $2,039 million, up from US $1,673.9 million during the same period last year. Compared to a deficit of US $11.2 million in fiscal 2023, a profit of US $216.7 million was made for the entire fiscal year 2024.