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Airport services aggregator DreamFolks Services has exited the domestic airport lounges business with immediate effect. The stock, in response, is down 5% on Wednesday, September 17.
The company informed the stock exchanges after market closing hours on Tuesday, that access to domestic airport lounges for its clients has been discontinued effective today, adding that the impact of this development is material. However, other domestic services and the global lounge business will continue as usual, it said.
"We reiterate that contracts with our clients remain active, and discussions on alternate customer value propositions are in progress," the company said in a statement.
The move comes just days after Travel Food Services terminated its contract with DreamFolks, which had been acting as one of the aggregators for banks and networks to provide lounge access across several of its lounges.
This followed another announcement made on August 29, when Adani Digital, Semolina Kitchen and Encalm Hospitality indicated their intentions to discontinue certain services.
In an exclusive interaction with CNBC-TV18 recently, Dreamfolks' CMD Liberatha Peter Kallat highlighted that the company's clients were being pressured by competition to opt out of existing contracts with them and that the company too had indirectly received acquisition offers.
She accused the existing airport operators of pressuring the company's clients, without directly naming them.
A day after the interaction, Adani Airports CEO, in a post on social media platform LinkedIn, highlighted that lounge access on airports no longer requires middlemen and can be done directly through airport operators.
Shares of Dreamfolks Services are down 5% in early trading on Wednesday, at ₹131. The stock has declined over 40% since the first tender cancellation was reported a few months earlier.
The company informed the stock exchanges after market closing hours on Tuesday, that access to domestic airport lounges for its clients has been discontinued effective today, adding that the impact of this development is material. However, other domestic services and the global lounge business will continue as usual, it said.
"We reiterate that contracts with our clients remain active, and discussions on alternate customer value propositions are in progress," the company said in a statement.
The move comes just days after Travel Food Services terminated its contract with DreamFolks, which had been acting as one of the aggregators for banks and networks to provide lounge access across several of its lounges.
This followed another announcement made on August 29, when Adani Digital, Semolina Kitchen and Encalm Hospitality indicated their intentions to discontinue certain services.
In an exclusive interaction with CNBC-TV18 recently, Dreamfolks' CMD Liberatha Peter Kallat highlighted that the company's clients were being pressured by competition to opt out of existing contracts with them and that the company too had indirectly received acquisition offers.
She accused the existing airport operators of pressuring the company's clients, without directly naming them.
A day after the interaction, Adani Airports CEO, in a post on social media platform LinkedIn, highlighted that lounge access on airports no longer requires middlemen and can be done directly through airport operators.
Shares of Dreamfolks Services are down 5% in early trading on Wednesday, at ₹131. The stock has declined over 40% since the first tender cancellation was reported a few months earlier.
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