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Washington/Glasgow | Claims by a hedge fund of abandoned or phantom Corporate Travel Management offices around the world are misleading and fail to recognize the realities of running the market.
In a statement published ahead of its annual general meeting in Brisbane on Wednesday, CTM hit back at an explosive report by VGI on Sunday that the company's office footprint was overstated.
VGI identified a number of offices in North America and Europe that it claimed were empty or understaffed, including one in the Scottish city of Glasgow and one in Alaska's remote Aleutian Islands.
An on-the-ground visit by The Australian Financial Review to CTM 's Glasgow Rentals on Tuesday (Wednesday AEDT) and an interview with an independent Alaskan travel industry figure lend support to CTM' s position.
The $ 3 trillion company has rejected a raft of charges by VGI, including how it accounts for revenue, stock sales by executives, and claims of empty offices in places like Baar, Switzerland, and Amsterdam.
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"The VGI report dedicates 58 pages to alleging that CTM 's global office footprint is overstated," the company said in the statement.
"The company has a clear strategy to establish a global footprint and generate scale, but it is not only a matter of cost-effectiveness, but of the small-scale production of 'bricks and mortar' empire."
Tea Financial Review Traveled to Glasgow by CTM as a "ghost office" appears to be vacated by CTM in July, if not earlier.
The second current occupants of Level 2 of the Hatrack building on St Vincent Street show them as new tenants, who took up the space in June and July this year.
The space was formed by Chambers Travel Group, which was bought by CTM in December 2014.
In a briefing to its investors, VGI published photos of the lobby lobby listings showing CTM was absent.
It appears CTM may have failed to update its website. The Hatrack listing has now been taken over by the company's website.
Glasgow Mandela Place, a couple of blocks from the Hatrack, where it occupied half a floor of the grand late 19th-century Athenaeum building.
CTM only leased that site in September this year.
"Where there is enough customer demand," said the CTM, "The company said on Wednesday. "Another large European office is our Glasgow office."
"With the exception of Dutch Harbor, the other offices cited by VGI are legacy rentals where we are not going to be renewed.
"This is part of our office consolidation strategy."
CTM's branch in Dutch Harbor, Alaska, was visited by VGI, which said it was originally shown on the company's website.
After being appointed to the office at the airport, VGI declared it to be a "skeleton office" with only a "small number of employees".
CTM said that it was better off because it was better than meeting the needs of a corporate fly-in-fly-out seasonal customer.
The office was part of a CTM acquisition made in 2014, when it bought Anchorage-based USTravel.
"It's legit," said Scott McMurren, owner of an Anchorage-based leisure travel firm, Alaska Travel.
Mr McMurren told the Financial Review that he has not only seen the office, but said it served the lucrative fisheries industry.
Mr McMurren described himself as a very familiar with Mark Aliason, who died in 2013. Mr McMurren wrote Mr Eliason's obituary in the Anchorage Daily News.
He said that it is not the only way in which to consolidate – what is typically the case for consolidation – that the one tagged by VGI in Dutch Harbor supports the industry like Icicles and Trident.
"That's big business," he said.
"They had the state of Alaska and they're flying all over," he said of USTravel's business. After the sale of CTM's North America headquarters in Denver, Colorado, he said.
"They were basically buying the market position."
CTM has been updated to update its website contact addresses.
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