Stray buys Loka to become APAC’s largest “flexible adventure travel network”

Stray bus on the road in the South Island. Image: Stray Travel

Auckland-based Stray New Zealand has bought Australia’s Loka adventure travel operator in a deal the companies say will create Asia Pacific’s largest “flexible adventure travel network”.

The deal sees Stray’s owners, which include Ritchies Transport, expand their Australian interests with the new majority shareholding in Loka, purchased for an undisclosed sum. Some of the same shareholders own the Australian campervan hire company Spaceships.

The deal also sees the founder and director of Byron Bay-based Loka, Neil Geddes, return to Stray, a company he founded in 2002. Prior to Stray, Geddes had founded Kiwi Experience in 1988.

“It is amazing to be working with Stray and to be part of the orange family again,” said Geddes in a statement. “The investment will provide the resources to continue our journey to provide the best experiential trip in Australia”.

Stray NZ chief executive Brett Hudson told the Ticker the deal created Asia Pacific’s “largest and most expansive flexible adventure travel network” with operations spanning New Zealand, Australia and Southeast Asia. Stray Asia operates in Thailand, Laos, Cambodia, Vietnam and Myanmar.

“There are clear synergies between Stray NZ and Loka, which is a fantastic product. The challenge in Australia is the great distances involved but Neil has structured a really good business over there and, with our distribution channels in the UK and Europe, coming together was the right move for us,” said Hudson.

“We’re confident we’ll be able to grow and capitalise on the Australian business while also generating further sales and cross-promotion for our businesses in Asia and New Zealand.”

Youth holiday arrivals – aged 18 to 29 – to New Zealand, the most important market to Stray’s domestic operation, was growing by around 11% per year reaching more than 412,000 for the year to May 2017. The Australian youth market – measured as aged between 15 and 29 years – saw 2.1 million arrivals.

“Loka has 0.6% of the market in Australia and Stray and Kiwi Experience capture about 30% of the market in New Zealand,” said Hudson. “If we can get 4% market penetration in Australia through Loka, that would be larger than Stray and Kiwi Experience combined in New Zealand.”

Stray’s New Zealand operations run up to 30 coaches in summer, while Loka operates bus and rail tours along Australia’s east coast from Sydney to Cairns with 14 and 5 departures respectively from those cities over the summer.

Hudson said Loka would continue to operate under its own brand but would be integrated from an operational and marketing perspective into Stray’s wider portfolio.

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