How A Cheap Spin-Off Turned Into A Webjet Takeover Battle

Fund managers detail the valuation gap that drew rival bidders after Webjet's 2024 demerger from Web Travel Group

31 May 2025 · 4 min read

A cheap, cashed-up spin-off turned into one of the more contested takeover battles of 2025 for Webjet Group. Tamim Funds Management laid out the case in March 2025, describing a company with a $200 million market cap and $100 million of net cash, generating $36 million of EBITDA and around $16 million of free cash flow, putting the stock on roughly three times EV/EBITDA. The manager said directors had been buying shares and so had the fund, calling it one of the more attractive risk-reward opportunities on the ASX.

WJL market cap is $200m with $100m of net cash. The company makes $36m of Ebitda and circa $16m of FCF. This places the stock on 3x EV/Ebitda which is incredibly cheap. Directors have been buying shares recently and so has the fund.

— Tamim Funds Management, Monthly Report, March 2025

How the takeover battle unfolded

That valuation gap did not last. Wilson Asset Management reported in May 2025 that Webjet's share price performed strongly following in-line FY2025 results and a non-binding takeover offer from private equity firm BGH Capital at 80 cents a share, which the company rejected as materially undervaluing the group, with the market speculating a higher offer would follow. Harvest Lane Asset Management, describing the situation the same month, said Webjet was shaping up as one of the big arm wrestles of 2025, with Helloworld and veteran corporate figure Gary Weiss emerging as a second strategic party vying for control or profit, or both, alongside Bain Capital's separate stakebuilding.

Tamim Funds Management closed out its position as the situation resolved in May 2025, noting that Bain Capital had acquired a 10.8 per cent stake and Helloworld 15 per cent, both aggressively buying on market, with Bain following up with what the manager called an underwhelming 80 cents conditional bid. Having built its position below 55 cents in March and April, the manager said it decided to take the easy win once the stock reached 90 cents and move on, rather than wait to see how the contest between the strategic parties ultimately played out.

The strategic logic behind the interest

Naos Asset Management, an early holder from the September 2024 demerger from Web Travel Group, framed the appeal of the standalone consumer business in terms of market position and balance sheet capacity. The manager said Webjet had maintained the number one position in both the Australian and New Zealand online travel agency markets, with strong brand recognition meaning many customers navigate directly to its website rather than through paid search, helping preserve margins, and pointed to around $100 million of available cash giving the newly independent entity significant capacity to invest in organic growth and pursue complementary acquisitions.

Market Leading Position – Despite competition from large multinationals attempting to gain share in the Australian OTA market, Webjet has maintained a stable market share, holding the number one position in both Australia and New Zealand.

— Naos Asset Management, Quarterly Report, September 2024

What managers were watching as the contest closed

With Bain Capital and Helloworld both having built meaningful stakes and BGH Capital's initial bid rejected as too low, the situation that played out through 2025 tested whether Webjet's board could extract a price closer to the fundamental value multiple managers like Tamim Funds Management had identified, rather than settling for the opening conditional offer, with the eventual outcome shaping how much of that arbitrage value shareholders who held through the contest were able to capture.