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Expedia Inc acquires Tavelocity in a $280 million deal

January 24, 2015
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Expedia has acquired the online travel agency Travelocity from its parent company, Sabre Corp for a whopping $280 million in cash. The companies revealed about this deal in a statement on Friday, as a unification in the online booking industry continues. The deal follows a 2013 marketing agreement in which Expedia Inc's technology powered platforms for Travelocity's U.S. and Canadian websites, while Travelocity drove additional web traffic to Expedia.


Expedia started off in October 22, 1996 as the first Microsoft internet property. The idea came from going beyond content which was the standard at the time. It is a web -based travel online company having headquarters in Bellevue, Washington. Expedia has also provided localized sites for 30 different countries. It has evolved as a consolidated solution for all your travel queries and Air tickets booking, Hotel bookings, Car rentals, Cruises, Vacation packages, etc.

In June 2014. Expedia started accepting Bitcoins. In September 2014, Expedia partnered with Citigroup and created the Expedia+ card where members can earn bonus points and earn exclusive benefits and priority customer service through the website. In October 2014, Expedia agreed to acquire Australian reservation service for $US610 million.

The Travelocity deal executes further amalgamation in the online booking space, which has witnessed a number of procurements from Expedia's fierce competitor, Priceline. One of which is its $2.6 billion takeover of restaurant reservation website OpenTable last year. "Given the success that they've had with integrating Travelocity into Brand Expedia (through the 2013 agreement), it's a positive outcome,'' said S&P Capital IQ analyst Tuna Amobi.

Travelocity is likely to maintain its unique brand within the umbrella of Expedia, according to Amobi. Sabre's Chief Executive Officer Tom Klein said the company's primary focus remains to be the providing of "mission-critical software solutions'' to its global travel customers. We have had a long and fruitful partnership with Expedia, most recently by partnering to strengthen the Travelocity business, so our decision to divest Travelocity is a logical next step for us both,'' he said in the statement.

Expedia, which owns brands ranging from the website that carries its name to the top hotel booking sites, stated in its October quarterly filing that the sales volume of its air tickets for the first three quarters of 2014 grew by 29 percent, "primarily due to volume driven by Brand Expedia's agreement with Travelocity along with ongoing improvements for the Brand Expedia sites themselves.''

Expedia's shares climbed nearly 2 percent Friday, while Sabre's shares were up more than 1 percent.

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