travel, hotel and booking Information

Online travel mergers and acquisitions soar

Hotel Booking The online travel consolidation train is running full speed ahead. Distribution Systems (GDS) buying online agencies and B2B technology companies, and leading online travel agencies buying smaller competitors.

Groople In the News Groople Selected by Bizbash as Provider for Group Travel Bookings June 1, BiZBash, the preeminent resource for the event planning industry, today announces a partnership with Groople.com, making Groople the exclusive online group travel partner for BiZBash's thousands of event professionals. BiZBash users now have Groople's group travel tools, with the unique ability to research and make group travel arrangements online. While most travel booking sites don't allow for group reservations at all, through BiZBash, hotel bookings for 5 rooms or hundreds of rooms are now simple to book and include special group rates. With an initial offering of hotels, the service will expand to offer airfare, cruise, car and rail bookings online. free number ( 4316) is available for arranging air, cruise, car and rail, as well as more complicated hotel requests.

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Groople (www.groople.com), the leader in group travel planning, has partnered with Go10000, a travel focused development and hosting firm, to bring to market a new group collaboration site for the travel space. GroopVine will provide the solution to the complex communication and booking problems group travel planning can create. Enhancing the online travel space by combining the key elements of social networking such as invitations, forums, messaging, photos and video posting, with the best in online travel booking, GroopVine is the only place for group travelers to shop, plan and book together online.

Cheap Hotel The effects of these deals are clear the top five online travel services represent 57% of the entire online travel market, according to PhoCusWright data. The rate of consolidation should increase in 2001 as small companies find it difficult to compete in this expensive marketplace, financing opportunities dwindle and market leaders get even more entrenched. The largest of all deals was Sabres October acquisition of GetThere.com for $757 million. That transaction solidly positioned Sabre as the leading provider of business-to-business online travel services. Before being acquired, GetThere.com was involved in its own M&A activity. It purchased AllMeetings Corp., a provider of online corporate travel and meeting management solutions, in July for $25 million. The month prior, GetThere.com bought Automated Travel Systems, an Internet low fare search system.

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Flight Booking GetThere.com was not Sabres only online travel deal. In August, Sabre acquired Gradient Solutions, a Dublin, Ireland-based travel technology company that complements GetThere.com. Gradients competitor, Datalex, had purchased Sight and Sound for $40 million to shore up its booking engine technology. To strengthen its position in the Web-based corporate travel market, Datalex also acquired 50% of Yatra, which provides a direct-connect solution for corporate travel, for $11 million. Then, to further compete with the Sabre/Gradient combination, Datalex teamed up with another leading GDS, Worldspan, which took a small equity position in Datalex for $10 million in September.

Travel agents obtain some of their information from the same sources as online booking sites such as Orbitz and Travelocity. They also receive daily emails and faxes with new specials from resorts and hotels that may not be published on the internet. Travel agents can also call a place directly to see if they can work out other kinds of special deals for you, something an online site can’t do.

Travel Agent At least two other deals were valued at over $250 million; both were acquisitions of online travel agencies. Travelocity.com spent $286.2 million to merge with Preview Travel, the third largest online travel agency, to form the market leader. The price included Preview Travel stock as well as the value of the vested options of Preview Travel assumed by Travelocity.com and other costs directly related to the merger. That payment seems reasonable considering that just one month prior, Galileo spent close to the same amount $269 million to acquire 80% of the seventh largest online travel agency Trip.com. (Galileo had purchased 20% in Trip.com in April 1999.)

Groople is the leader in online group travel, stop group booking on hotel, cruise, air, bus, and rail, and is backed by partnerships with the largest travel suppliers worldwide. Groople is group travel made easy, offering discounted rates, individual payment options and a single point of contact. With more than 60, 000 hotel choices worldwide and six top cruise lines brought together in an online group booking website, Groople offers unrivaled benefits for the group travel consumer. Groople customer sales center provides personal attention and offers group travel experts to advise leisure group travelers on weddings, family reunions, religious groups, sports teams, and more. Created by twenty travel industry veterans, Groople pioneered the online group travel space and continues to lead the group travel industry in technology, inventory and convenience.

Hotel Chicago Other online travel agencies acquired during the year were Travelscape.com by Expedia for $103 million, OneTravel.com by Amadeus and Terra Lycos (55% stake), and TravelNow.com by Hotel Reservations Network for $47.4 million. In January 2001, Travelbyus.com merged with Aviation Group Inc. to form two separate public companies, Travelbyus Inc. and Travelbyus.com Ltd. Two European online agencies changed hands: the French Degriftour Group was bought by LastMinute.com for $88.4 million and the Swedish Travelstart.net was purchased by Tiss.com.

Online Booking Consolidation in the adventure travel industry became reality: there were three major transactions in the year, including Unexploreds acquisition of Adventureseek in November. That leaves Away.com, Gorp, and iExplore as leading independent adventure travel sites (National Geographic took a 30% stake in iExplore in August). All four leading GDS made at least one online travel deal in the year; besides those mentioned, Amadeus also acquired Vacation.com in a $90 million deal.

Travel Health Insurance There are few independent online travel agencies, since Travelocity.com is majority owned by Sabre, Expedia by Microsoft, OneTravel.com by Amadeus/Terra Lycos and Trip.com by Galileo. Biztravel.com is 100% owned by Rosenbluth.

Hotel Reservation Of those that are independent, priceline.com is the most vulnerable. Its flagging stock price makes it an easy target its value is millions of customers buying more than $1 billion in online travel using a unique demand-driven system. It would be a great asset for a travel agency to own (dont plan on it shutting down and going away).

London Hotel Booking Also look for further consolidation in the adventure travel market where the three remaining leaders struggle to build transactions in a burgeoning, but overcrowded, market niche.

Discount Travel Discount hotel leader Hotel Reservations Network will need to become more aggressive if it wants to become a full service online travel agency. The TravelNow.com deal was a start, but certainly not enough to significantly expand HRNs air, vacation and car rental business. HRN would be perfect a fit for a larger travel agency; it already has a partnership deal with Travelocity.com.

Orlando Hotel Of course, one can only speculate on future transactions. But a look at the previous years deals does show a certain natural progression that is likely to continue into 2001.

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