Priceline Buying OpenTable for $2.6 Billion
Priceline is buying OpenTable for $2.6 billion it was announced Friday.
"OpenTable is a great match for The Priceline Group. They provide us with a natural extension into restaurant marketing services and a wonderful and highly-valued booking experience for our global customers," Priceline CEO Darren Huston said in a statement. "We look forward to helping the OpenTable team accelerate their global expansion, increase the value offered to their restaurant partners, and enhance the end-to-end experience for our collective customers across desktop and mobile devices."
OpenTable CEO Matt Roberts added: "The Priceline Group is a leader in e-commerce innovation with global expertise in online marketing and digital customer conversion across devices, and they have an exceptional track record of customer service in dozens of languages around the world. We couldn't be more excited to join a group of brands leading in their space, and we look forward to the next chapter of our own journey as we continue to enhance the dining experience for our customers worldwide."
The deal is an all-cash transaction in which The Priceline Group will acquire OpenTable for $103 per share. The boards of directors of both companies have unanimously approved the deal, which is expected to close in the third quarter of this year subject to closing conditions like regulatory clearance.
OpenTable will continue to be based in San Francisco and operate as an independent business led by its current management team within The Priceline Group.
OpenTable is the world's leading provider of online restaurant reservations, with more than 15 million diners seated per month across more than 31,000 restaurants. Priceline is the world's leading accommodation booking platform, with an average of more than one million guests staying in accommodations booked through one of the Priceline brands in more than 480,000 properties in more than 200 countries and territories worldwide.
On a conference call to discuss the deal, Huston and Priceline CFO Dan Finnegan stressed that getting into the restaurant-reservations business is a natural move for Priceline and added that they hoped to improve OpenTable's global reach.
"OpenTable is a natural fit for The Priceline Group," Huston said on the call. "We are each leaders in our respective marketplaces where proficiency in driving global demand, building and managing global supply and providing a superior multiscreen experience are critical. The assets, skills and relationships it takes to win globally in this respect are a complimentary match."
Houston also called restaurant reservations an "adjacent market" and noted that the "DNA" of the two companies is similar.
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In terms of being able to grow OpenTable internationally, the Priceline execs declined to discuss specific expansion plans, but they noted that while OpenTable is in London, Germany and Japan, Priceline has "offices in every major city in the world" and it's Priceline's "vision for OpenTable to become a global brand."
"It's the same customers," Huston said on the call. "I mean travelers are diners, and some of the most valuable diners because they're transient diners. We believe there's opportunity to cross-promote OpenTable and the rest of the group's brands to the same customer base."
Priceline is also looking to enhance OpenTable's mobile capabilities, saying that OpenTable's mobile payment technology certainly factored into their decision and offered a capability that's in line with how Priceline has been approaching mobile.