Expedia Inc has acquired online travel company Travelocity from parent company Sabre Corporation for $280 million, in an all-cash deal. This deal is for Travelocity’s North American (US & Canada) websites only.
This acquisition follows the tie-up between the two companies in 2013 that saw Expedia power the technology platforms for Travelocity’s US & Canada websites and provide Travelocity access to its supply & customer service program. Travelocity in return drove web traffic to Expedia’s web properties.
— dara khosrowshahi (@dkhos) January 23, 2015
In Q3 FY15 (pdf), Expedia’s room night bookings grew 24% year-on-year (YoY) of which Travelocity contributed about 4%. Overall Expedia’s gross bookings (mainly room nights & air ticket bookings) increased by 29% in this quarter, primarily driven by the Travelocity partnership.
Expedia is expected to retain the Travelocity brand, given that Expedia CEO Dara Khosrowshahi mentioned that Travelocity receives 20 million visitors per month. Both companies are major players in the online travel space in North America, along with Priceline which had acquired online travel agency Kayak for $1.8 billion in November 2012 and online restaurant booking service OpenTable for $2.6 billion in June last year.
Travelocity had shut down its India-specific website in February 2013 and started redirecting Indian users to its global site. It had also sold online hotel aggregator TravelGuru to Yatra.com in July 2012, three years after acquiring it. Interestingly, TravelGuru was initially reported to have been acquired Expedia in India in 2008, but that deal was eventually denied by the company.