TripIt Acquisition Brings Azure Healthy Multiple On Capital

Concur Technologies Inc. on Thursday announced it would buy travel site TripIt Inc. in a deal that could reach $120 million and bring a handsome return to its largest shareholder, Azure Capital Partners.

Azure General Partner Mike Kwatinetz says the firm’s return on the deal could top its sale of Bill Me Later to eBay Inc. in 2008, which had a better than 5X payback. “It’s a pretty nice multiple,” he said. Kwatinetz declined to provide further comment.

Azure participated in a $7 million funding round for TripIt in March 2010 along with O’Reilly AlphaTech Ventures. All told, TripIt has raised $13.1 million.

The terms of the acquisition are somewhat complex. Concur, a public developer of expense management software, will spend roughly $27 million in cash and surrender approximately $44 million in stock at closing. An additional amount settled on 30 months from closing could reach up to $38 million, subject to “certain adjustments and escrow provisions,” according to a press release. Concur also will exchange unvested TripIt options into Concur restricted stock with an aggregate value of approximately $11 million at closing.

Travel site TripIt has been growing rapidly and now has millions of users, says Kwatinetz (pictured). The site allows users to consolidate travel arrangements booked elsewhere into a single itinerary and share the plans with friends and co-workers.

The deal will help build a solid foundation for Azure’s second fund, which according to Thomson Reuters data is a $300 million fund raised in 2005.

Kwatinetz says he was swayed to sell not just by the attractive offer but by the belief that Concur will help TripIt accomplish many of its business objectives. “I think they can accelerate a lot of things,” he said, adding, “there’s a bird in the hand concept.”