Flight Centre Travel Group has agreed to acquire UK online cruise leader Iglu for £122 million, boosting its cruise sector footprint and upgrading FY26 profit guidance. The deal promises immediate earnings accretion and strategic expansion into key global markets.
- Acquisition of UK’s leading online cruise agency Iglu for £122 million
- Annualised cruise-related transaction value to exceed $2 billion in FY26, two years ahead of plan
- Deal expected to be earnings per share accretive in FY26 with £27 million in performance earnouts
- Upgraded FY26 profit guidance to $315m–$350m reflecting Iglu’s contribution
- Iglu’s proprietary digital platform to enhance FLT’s omni-channel cruise capabilities and global expansion
Strategic Acquisition to Accelerate Cruise Growth
Flight Centre Travel Group (FLT) has taken a decisive step to strengthen its position in the lucrative cruise travel market by acquiring Iglu, the United Kingdom’s leading online cruise agency. The £122 million deal, comprising a £100 million upfront payment plus up to £27 million in performance-based earnouts, is set to close imminently, pending procedural approvals.
This acquisition significantly expands FLT’s cruise footprint, particularly in the UK; the world’s third-largest cruise market; while adding a scalable, proprietary digital platform that promises to unify and enhance the customer experience across FLT’s global leisure brands. The move is expected to accelerate FLT’s cruise-related total transaction value (TTV) to over $2 billion in FY26, achieving this milestone two years ahead of the company’s original plan.
Financial Upside and Synergies
Iglu’s attractive margin profile, with a 3.1% EBITDA margin forecast for FY25 compared to FLT’s leisure division average of 2.2%, underpins the financial rationale for the acquisition. On a pro-forma basis, Iglu is expected to deliver approximately £14.8 million in adjusted EBITDA from around £450 million in TTV during FY26.
FLT has upgraded its FY26 underlying profit before tax guidance to between $315 million and $350 million, reflecting a circa 3% increase attributable to Iglu’s part-year contribution. The acquisition is anticipated to be immediately accretive to earnings per share in FY26, with additional synergies estimated at around £2.1 million annually within two years.
Technology and Market Expansion
Beyond the financials, Iglu’s industry-leading digital platform offers FLT a springboard for further expansion into high-growth markets such as the United States. The integration of Iglu’s omni-channel capabilities with FLT’s existing leisure brands; including Flight Centre, Scott Dunn, and Cruise Club UK; positions the group to capture a broader share of the global cruise market.
FLT’s managing director Graham Turner highlighted the strategic importance of the acquisition, emphasizing the immediate shareholder value and the long-term growth opportunities unlocked by combining Iglu’s technology and brand strength with FLT’s global reach.
Leadership and Cultural Fit
Post-acquisition, Iglu’s CEO David Gooch will continue to lead the business, which will operate within FLT’s global leisure division. Gooch expressed enthusiasm about joining Flight Centre, citing the strong cultural alignment and the potential to scale operations while preserving Iglu’s unique identity.
The transaction also marks an exit for Iglu’s previous investors, including UK private equity firm LDC, Beauport Partners, and founder Richard Downs, concluding a decade-long partnership that established Iglu as the UK’s dominant online cruise agency.
Looking Ahead
With a new $3 billion annualised cruise TTV target set for FY28, FLT is clearly positioning itself as a major global player in cruise travel. The acquisition of Iglu not only accelerates this trajectory but also diversifies FLT’s geographic exposure, reducing reliance on the Southern Hemisphere leisure market.
Investors will be watching closely to see how quickly FLT can integrate Iglu’s platform and realise the promised synergies, as well as how the expanded cruise portfolio performs amid evolving consumer trends and competitive dynamics.
Bottom Line?
Flight Centre’s bold acquisition of Iglu sets the stage for accelerated cruise sector dominance; but integration execution will be key.
Questions in the middle?
- How quickly will FLT integrate Iglu’s digital platform across its global brands?
- What are the risks around achieving the projected £2.1 million in annual synergies?
- How will competitors in the UK and US cruise markets respond to FLT’s expanded footprint?