Shares of both Expedia (EXPE ) and Orbitz (OWW) surged on Thursday morning after reports that Expedia has agreed to acquire its competitor in a $1.6 billion deal.
The deal will allow Expedia to acquire Orbitz Worldwide and all of its brands for $12 per share, or $1.6 billion in cash. This deal has been approved by the Boards of Directors of both companies and is subject to approval from Orbitz’s shareholders.
Dara Khosrowshahi, President and CEO of EXPE, commented: “We are attracted to the Orbitz Worldwide business because of its strong brands and impressive team. This acquisition will allow us to deliver best-in-class experiences to an even wider set of travelers all over the world. From the flagship Orbitz.com brand, to other well-known consumer brands such as CheapTickets, ebookers and HotelClub and the business-to-business brands Orbitz Partner Network and Orbitz for Business, the Orbitz Worldwide team has built a devoted customer base and we look forward to welcoming them to the Expedia, Inc. family.”
Shares of EXPE were up $7.70, or 9.84% during pre-market trading Thursday. The stock is down 8.36% YTD.
Shares of OWW were up $2.08, or 21.52% during pre-market trading Thursday. The stock is up 16.89% YTD.