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Department of Justice Sues to Block Amex GBT Acquisition of CWT Holdings

The U.S. Department of Justice lawsuit seeks to stop the $570 million acquisition of the third-largest travel management company by its larger rival

By Todd R. Berger

1.14.25 CWT Holdings headquarters in Minnetonka, MN; Department of Justice Sues to Block Acquisitio
CWT Holdings headquarters is in Minnetonka, Minnesota. The U.S. Department of Justice is suing to block Amex GBT’s acquisition of the company. || Courtesy of LoopNet

The U.S. Department of Justice filed a civil antitrust lawsuit in mid-January to stop Global Business Travel Group Inc. (Amex GBT), the largest business travel management company in the world, from acquiring its rival, CWT Holdings LLC, the third-largest business travel management company in the world. The complaint, filed in the U.S. District Court for the Southern District of New York, alleges that the proposed $570 million transaction—Amex GBT’s fifth acquisition of another travel management company since 2018—would harm competition for business travel management services to U.S. global and multinational businesses.

“American businesses rely on travel management companies to connect employees, control travel costs, make travel booking and expense management easier, and ensure their employees’ safety during travel,” says Acting Assistant Attorney General Doha Mekki of the U.S. Department of Justice’s Antitrust Division in a prepared statement. “This acquisition is the latest in a series of acquisitions by Amex GBT that will further consolidate an already consolidated market with only a handful of competitive options capable of serving customers with the most need for travel management services. American businesses will face the consequences, seeing higher prices, less innovation, and fewer choices.”

As alleged in the U.S. Department of Justice complaint, Amex GBT and CWT anticipated that the proposed acquisition would harm competition and benefit the merged firm at the expense of its customers. The complaint alleges that senior Amex GBT executives viewed the acquisition as an opportunity for “consolidation” of the market for business travel management services for global and multinational customers and a respite from its recent customer losses to CWT. The complaint further alleges that Amex GBT recognized its valuation of the proposed acquisition should reflect the financial benefit of avoiding future loss business to CWT. For example, its CEO wrote to its president that the company “need[ed] to consider how much we might lose to [CWT] each year in a [business-as-usual] scenario.” During deal negotiations, CWT’s owners likewise believed Amex GBT should pay a higher price for CWT in recognition of the increased revenues Amex GBT would enjoy post-merger due to the reduction in price pressure from removing a large competitor.

The complaint alleges that the combination of Amex GBT and CWT would combine two of the three largest players in business travel management services for global and multinational companies located in the U.S., giving the combined firm a significant share in a market that one of the largest owners of CWT has acknowledged is “oligopolistic.” Few other companies can effectively provide travel management services to global and multinational companies located in the U.S. at the scale of Amex GBT and CWT.

Currently, Amex GBT and CWT compete fiercely to provide travel management services for large businesses and those with complex travel needs, the U.S. Department of Justice asserts. CWT recently began pursuing new and innovative strategies to improve service and reduce prices in order to win over business from Amex GBT. As a result, Amex GBT recently lost several significant bid opportunities for large business customers to CWT. If Amex GBT is permitted to acquire CWT, this intense competition would be lost, risking higher costs that will be borne by the many businesses and employees for whom these services are critical to their productivity and operations, according to the U.S. Department of Justice.

Amex GBT is a publicly traded Delaware corporation with its principal executive office located in New York City and its operational headquarters located in London. In 2023, Amex GBT managed a total transaction value of approximately $28.2 billion, earning revenues of $2.29 billion.

CWT Holdings LLC is a privately held company headquartered in Minnetonka, Minnesota. In 2023, CWT managed a total transaction volume of approximately $14 billion, earning revenues of about $850 million.

amexglobalbusinesstravel.com

justice.gov

mycwt.com

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