Travelzoo (TZOO) – A Merger Long In The Making

Media and Entertainment
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Wednesday, November 30, 2022

Travelzoo® provides its 30 million members with exclusive offers and one-of-a-kind experiences personally reviewed by our deal experts around the globe. We have our finger on the pulse of outstanding travel, entertainment, and lifestyle experiences. We work in partnership with more than 5,000 top travel suppliers—our long-standing relationships give Travelzoo members access to irresistible deals.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Patrick McCann, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Attractive merger. On November 25, 2022, the company entered into a stock purchase agreement with Azzurro Capital Inc, the company’s current largest shareholder. Travelzoo will issue 3.41 million shares in exchange for $10 million and Metaverse Travel Experiences (MTE), a fully owned subsidiary of Azzurro. Following the merger, Azzurro will own slightly more than 50% of the outstanding shares. Assuming shareholder approval, the transaction should close by year end. 

Terms of the deal. The $10 million can be paid in a combination of cash and promissory notes, at the election of Azzurro. There must be a minimum of $2 million in cash received at the time of closing. The remaining $8 million would be in secured promissory notes that would be repaid in two installments, March and June of 2023. The structure of the deal should allow Travelzoo to absorb the significant NOLs of the acquired company. 

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