American Express Co. agreed to spin off half its business-travel unit in a $900 million deal that creates a joint venture with a group that includes Qatar's sovereign-wealth fund.
The credit-card issuer will sell the 50 percent stake for $900 million to the investor group that was formed by Certares International Bank LLC and includes Qatar Holding LLC, the Qatari firm said today in a statement. The transaction is expected to be completed in the second quarter.
The new unit will continue using the American Express brand and will be led by Bill Glenn, the New York-based company's president of global commercial services, according to the statement. Amex, the biggest U.S. card issuer by purchases, may invest some proceeds in growth initiatives, according to the statement. The consumer travel business isn't part of the deal.
"The joint venture reflects our continued commitment to the travel business through a new structure," said Kenneth I. Chenault, AmEx's chief executive officer, according to Qatar Holding's statement.
Amex said in September it was in talks to spin off the unit in a deal valued at $700 million to $1 billion.
Qatar Holding is a subsidiary of the Qatar Investment Authority, which controls more than $100 billion of assets.
Certares is led by Michael Gregory O'Hara, a former chief investment officer of JPMorgan Chase & Co.'s special investments group. He'll serve as chairman of the joint venture, according to the statement.