This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Priceline Announces Opentable Acquisition for $2.6 Billion Cash

NEW YORK (TheStreet) -- Priceline (PCLN - Get Report) announced Friday morning that it's going to acquire Opentable  (OPEN) for $103 per share, paying a total of $2.6 billion in cash.

For Priceline, Opentable provides "a natural extension into restaurant marketing services and a wonderful and highly valued booking experience for our global customers," said Darren Huston, the president and CEO of Priceline, in a press statement.

Priceline helps find the best prices when booking planes, hotels, cruises, cars, and vacation packages. Priceline acquired Kayak, another travel booking website, in 2012. San Francisco-based Opentable company allows users to make restaurant reservations online.

Capital Group Companies owns 13.98% of Opentable shares, T. Rowe Price owns 9.11%, while investment firm BlackRock  (BLK) hold an 8.9% stake.

Reaction to news of the acquisition has been positive. 

"We think Opentable has somewhat under-invested in traffic acquisition and conversions, and can clearly benefit from Priceline's expertise, particularly in search marketing efforts overseas," wrote RBC Capital Markets in a report led by Rohit Kulkarni. "Opentable is predominantly used by locals but with help from Priceline, Opentable could tap into the non-local market as part of the end-to-end app."

Nonetheless, Opentable could run into expansion problems abroad because of previously established competition. Domestically "Opentable has a "monopolistic" market share, particularly in N.America, but we have come across a series of private / local players in Europe (e.g. La Fourcette- acquired by Tripadvisor and Bookatable/Live Bookings) and Japan (Tabelog - operated by," wrote Kulkarni.

The deal is expected to close in the third quarter of 2014.

Shares of Opentable were surging 47% to $103.73 while Priceline was falling 2.5% to $1,195.84.

**Why Priceline's $2.6 Billion Buy of OpenTable May Be a Bargain --Written by Whalen MacHale in New York

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
OPEN $102.95 -0.02%
PCLN $1,187.53 0.00%
AAPL $124.75 0.00%
FB $80.78 0.00%
GOOG $524.05 0.00%


DOW 17,826.30 -279.47 -1.54%
S&P 500 2,081.18 -23.81 -1.13%
NASDAQ 4,931.8150 -75.9760 -1.52%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs