Skyscanner’s landmark deal with Chinese giant

TRAVEL website Skyscanner will today sign a landmark deal with Chinese search engine giant Baidu and reveal plans to open an office in Beijing.

The Edinburgh-based travel search company, known as “Tianxun” in China, will allow Baidu’s 440 million users to search for international flights.

Skyscanner chief commercial officer Frank Skivington hailed the deal as a “genuine coup” that has “the capability to be transformational” for the firm.

As a result of the partnership, he expects the firm’s business in South-East Asia will account for half of the group’s revenues in the next two to three years, up from 15 per cent at present following the opening last year of its base in Singapore.

The company grew its revenues by 70 per cent to £15.3 million and more than doubled profits to £3.4m in the year to 31 May, 2011.

In January, Gareth Williams – Skyscanner’s co-founder and chief executive – told Scotland on Sunday that he expects turnover to hit £20m this year before rising to more than £60m within the next two years.

He revealed his ambition for Skyscanner to become Scotland’s first $1 billion internet company and raised the prospect of the business floating through an initial public offering (IPO) on the stock market. Williams said: “I would like to be big enough that an IPO was the only option.”

Baidu, known as the “Chinese Google”, is the biggest website in the fast-growing country, where there are an estimated 540 million internet users.

Skyscanner’s flight search technology will sit alongside that already employed by Baidu’s own company, Qunar, which is China’s largest flight search site and which focuses on domestic travel.

Skivington said: “The emergence of a whole cohort of business travellers and an independent wealthy middle class in China means the need for not just low-priced domestic travel but a very comprehensive international travel is clear and present. The top 50 air routes globally are now in Asia Pacific – a lot of that is in and out of China.

“For a market the size of China, and which is just beginning to grow, to have that presence on the main search engine is a genuine coup for us and genuinely has the capability if being transformational for us.”

The company is set to open an office in Beijing, to be headed by Yi Bao, who joined the Edinburgh-based firm when it acquired Zoombu last year. Skyscanner is initially recruiting a team of five.

The company also announced the relocation of its office in Singapore to larger premises to accommodate a planned doubling of its headcount there over the next 12 months.

Williams added: “We look forward to partnering with Baidu to provide the very best in travel search to their many users. Overall in Asia, we fully expect Skyscanner to grow to the size of our European business within a relatively short period and we are investing with this in mind.”