A Flurry of Hotel Tech Company Mergers and Acquisitions Marks the End of 2021

12.1.2021
Fran Worrall
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Since early 2020, the hospitality sector has witnessed a sea change. The worldwide disruption triggered by the COVID-19 pandemic forced almost every technology company in the industry to review their portfolios, reassess their strategies and redirect resources into areas with the greatest growth potential. Some businesses became targets for opportunistic deals, while others struggled to operate in ‘new normal’ mode.

Yet for companies with solid balance sheets and a willingness to take calculated risks, the pandemic provided unprecedented opportunities for growth through mergers and acquisitions. Mergers enabled some hospitality tech companies to combine resources and reduce operational costs; acquisitions allowed other businesses to gain access to new products and services or establish a foothold in a niche market.

Following are some of the more notable hospitality tech company mergers and acquisitions of the last few months.

UniFocus acquires Knowcross

In early September, Texas-based workforce management systems provider UniFocus announced its acquisition of Knowcross, a task management and operational optimization software company headquartered in New Delhi, India. The merging of the organizations’ technologies not only provides a single streamlined system for determining real-time labor needs and ensuring timely service completion but also brings Knowcross’s powerful solution suite into the service industries UniFocus serves.

UniFocus’s roots are in labor scheduling, demand forecasting and time & attendance, so expanding its platform further into operations management was a natural next step. The companies’ combined technology will enhance decision making by integrating information gleaned from forecasting, scheduling and task execution, as well as employee and guest satisfaction data.

Both UniFocus and Knowcross view the acquisition as a way to accelerate their plans for innovation and new market penetration. The two businesses will be infused with capital via The Riverside Company, a global private equity firm focused on the smaller end of the middle market.

Cendyn merges with Pegasus

In early November, Cendyn, an innovator in hotel customer relationship management and sales platforms, and Pegasus, a provider of hotel revenue and distribution solutions, entered into a merger agreement aimed at boosting direct bookings. At the center of the merger are Cendyn’s customer data platform and Pegasus’s central reservation system (CRM). When combined, the technology provides a system of record for guest profiles and rates and allows hoteliers to build on topline revenue through their direct channels.

Cendyn and Pegasus, headquartered in Boca Raton, Fla., and New York City, respectively, have been connected since early 2019 as sister companies in the investment portfolio of Accel-KKR, a technology-focused private equity firm. In February of that year, Pegasus merged with Travel Tripper, retaining the Pegasus name and introducing a rebranded platform. Six months later, Cendyn acquired The Rainmaker Group, a revenue and profit optimization platform for hotels, resorts and casinos.

Earlier this year, Cendyn announced a merger with NextGuest, a leading CRM and digital marketing provider. Combining under the Cendyn brand, the companies will deliver global scale capabilities to the hospitality space with a goal of driving demand and revenue performance by optimizing every touchpoint of the guest journey.

The recently-announced Cendyn-Pegasus merger comes at a time when hoteliers around the world are struggling with a lack of resources and a decrease in profitability. The merger will provide them with a platform to maximize the direct booking channel, enhancing the guest experience from beginning to end.

Cloud5 acquires Mid-America Telephone Systems

In November, Chicago-based Cloud5 Communications announced the acquisition of Mid-America Telephone Systems (MTS). Cloud5 is a leading provider of communications solutions and managed IT services for more than 5,000 hotels, multi-dwelling units and commercial facilities. MTS, located in Chesterfield, Mo., provides high-speed internet access,  telephony systems and in-room entertainment to the hospitality industry with a focus on economy brands, mid-market properties and independent hotels.

The two companies, which offer many of the same solutions and services, are a natural fit. With the acquisition, Cloud5 is launching an aggressive M&A strategy. In fact, according to a company statement, the deal represents the first of several opportunities Cloud5 is vetting to grow its solution portfolio and expand the markets it serves.

Revinate acquires GoMoment

In November, Revinate, a leader in omni-channel direct booking platforms, announced the acquisition of Go Moment, an artificial intelligence-driven messaging solutions provider for the hospitality industry. The acquisition creates a single customer data platform that seamlessly powers omni-channel guest lifecycle communications and commerce.

Go Moment’s digital concierge, Ivy, will be integrated with Revinate’s direct booking platform to facilitate targeted campaigns and engage with guests across various channels, including email, voice, SMS and popular messaging platforms. Hotels will be able to synthesize and activate data intelligence to convert direct bookings and commerce at any time during the guest journey.

Earlier this year, Revinate acquired NAVIS, which provides software that drives direct bookings. The acquisition enabled Revinate to expand its guest platform and generate scalable direct revenue through end-to-end guest lifecycle interactions.

Uniguest acquires Volara

Also in November, Uniguest, a global provider of connected technology solutions including digital signage and IPTV systems, announced its acquisition of Volara, a market leader in customizable voice-based engagement software. The acquisition will form the core of Uniguest’s new voice technology division and position the company to bring voice-based technology solutions to its hospitality customers around the world.

Volara’s software, which is hardware and platform agnostic, enables hotel guests to request items and services, obtain information about the property and nearby attractions, and access other unique voice-based experiences. Moreover, Volara is an authorized solution provider for Google Assistant’s Interpreter mode, enabling 29-language translation across commercial locations, including airports, stadiums and hotels. With voice solutions increasing in popularity, Uniguest anticipates high adoption rates.

Earlier this year, Uniguest, headquartered in Nashville, Tenn., announced the acquisition of two digital signage providers, UCView and JANUS Displays, as well as senior living software provider Sagely.

Also noteworthy . . .

In July, ASG, an Alpine Investors portfolio company that buys, builds and operates vertical SaaS companies, announced that it had acquired hotel operations management platform ALICE from Expedia Group. ALICE is the fourth acquisition in ASG’s hospitality technology vertical, joining Transcendent, ProfitSword and Visual Matrix.

In September, SaaS solutions provider RateGain Travel Technologies entered into an agreement to acquire myhotelshop, a provider of solutions that increase direct sales. The acquisition will enable properties to reach more guests at higher returns.

In November, Visual Matrix, a Texas-based property management software company, announced its acquisition of LodgingControls, a provider of housekeeping productivity software. The acquisition will enable hoteliers to streamline operations and improve employee productivity.

In November, Booking Holdings, a provider of online travel and related services, entered into an agreement to acquire Getaroom, a B2B distributor of hotel rooms. Getaroom will roll into Booking Holdings’ Priceline brand and join forces with its strategic partnerships team, Priceline Partner Network, to form a new business unit. The goal is to improve B2B distribution for hotel partners while offering a robust accommodations technology stack for affiliate partners.

Although no one has a crystal ball, many industry insiders anticipate more mergers and acquisitions ahead, as the need to stimulate the industry prompts a continuing wave of restructuring activity. Stay tuned . . . a few deals are likely to be announced before the end of the year, and Hospitality Upgrade will be the first to bring the news to its readers.

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