IAC/InterActiveCorp to Buy Hotwire

  • September 22, 2003
IAC/InterActiveCorp on Monday said it has entered into an agreement to acquire Hotwire.com, a discount travel website. The transaction is $665 million in cash plus the assumption of approximately $20 million of options and warrants. IAC estimates 2003 full year Gross Bookings for Hotwire of approximately $700 million and Net Revenue of approximately $110 million, and expects the transaction to be slightly accretive to 2004 adjusted EPS. Following the acquisition, Hotwire will remain a separate subsidiary and brand within IAC. Founded by Texas Pacific Group and airlines American, America West, Continental, Northwest, United and USAirways, Hotwire is an industry leader in 'opaque' travel, a service that enables online consumers to see and choose a specific fare or rate without knowing the brand of the supplier until after the item is purchased. This model enables Hotwire to offer discounts of up to 45% on airfares, and up to 75% on hotel rooms.
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