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On Friday Naspers announced that they are swapping their shares in MakeMyTrip, a US-listed Indian travel company, for shares in Ctrip, the largest online travel company in China. Ctrip is also listed in the US. This deal valued Naspers' MakeMyTrip stake at $1.3 billion, a 25% premium to what the shares were worth on Friday morning. The deal means that Naspers has swapped its 40% stake in a $2.4 billion company for a 5.6% stake in a $24 billion company.
After the swap, Ctrip will own 49% of MakeMyTrip, where there is a chance they will buy the balance in time. This means that Ctrip will be the leading online travel company for both China and India, the two largest nations by population who are increasingly spending more on travel. Over the last 10 years, China has increased its outbound travel spend 5 times and India has doubled its spend. This looks like an excellent deal for Naspers and is just another one of its assets that the market does not recognise.
