A BUSINESS with its roots in a Dublin backpacker hostel was sold for more than €200 million yesterday, with its two founders among the main beneficiaries of the pay day.
Web Reservations International (WRI) has been bought by US investment firm Hellman Friedman for an undisclosed sum but sources familiar with the transaction said the San Francisco firm paid “north of €200 million” for the company.
Considered the country’s most profitable internet venture, WRI has previously weathered difficult conditions, surviving the dotcom bust at the start of this decade.
It was founded in 1999, when Thomas Kennedy (43), owner of Dublin’s Avalon Hostel, was seeking a software program to manage his hostel business. Programmer Ray Nolan (44) had been selling Backpack, hostel management software, to hostels for a number of years.
The pair formed the idea for an automated booking service for thousands of hostels, reworking the Backpack program and giving it to hostels that promised to allocate some rooms to WRI.
Over the past 10 years, WRI has expanded considerably. The firm, which has its headquarters in Dublin, employs 93 people and has offices in Shanghai and Sydney.
The company, which owns a number of award-winning websites including Hostelworld.com, counts U2 manager Paul McGuinness and business associate Trevor Bowen among its shareholders. It is chaired by businessman and public relations executive Fintan Drury.
In 2007, it reopened the former fashion website Boo.com as a travel site, following the purchase of the well-known address for an undisclosed sum. At the height of the dotcom mania Boo.com swallowed $135 million of investors’ money in just 18 months but failed to generate significant business.
Other websites in the WRI stable include hostels.com, bedandbreakfastworld.com and trav.com. Last year, it generated net revenues of €38 million after selling €350 million worth of accommodation.
The deal with Hellman Friedman puts an end to speculation about the company’s future. Last year, a stock market flotation was shelved due to the volatile market conditions. “This business has been built by the vision of our founders together with the collective talents of a highly driven team at WRI,” said chief executive Feargal Mooney.
“We have an ambitious agenda for growth and further innovation.”
