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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Priceline Books $2.6B OpenTable Deal

NEW YORK (The Deal) -- Online booking company Priceline Group  (PCLN) is adding to its portfolio of services with the $2.6 billion acquisition of OpenTable (OPEN), announced Friday.

Priceline CEO Darren Huston called OpenTable "a natural extension" of its group of brands in a Friday call with investors.

The transaction values OpenTable at $103 per share, a 46% premium the prior close. Shares of the target jumped $33.28, or 47%, to $103.71 on Friday morning, brushing past Priceline's bid. Priceline stock dropped $15.09, or 1.2%, to $1,210.91.

OpenTable makes 15 million reservations per month internationally. The company generated $81.5 million in adjusted Ebitda last year. Revenue grew 18%, to $190 million, in 2013.

Huston outlined similarities in the "DNA" of OpenTable's restaurant booking service and Priceline's travel accommodations offerings.

"It's the same customers," he said. "Travellers are diners."

Priceline Group owns five main brands: priceline.com; hotel sites Booking.com and agoda.com; travel deal site KAYAK and rentalcars.com.

OpenTable would operate independently from its San Francisco headquarters following the deal.

Huston said Friday that both companies are leaders in their markets, match global demand with local supply and provide services on multiple types of devices.

Priceline could help OpenTable grow internationally, "which has been a challenge to them," Huston said. Priceline also plans to improve the target's wireless offering.

The deal is Priceline's second purchase in a week. The company announced the acquisition of hotel digital marketing group Buuteeq Inc. on Tuesday.

The OpenTable purchase includes $2.5 billion in net cash and $90 million in Priceline equity to cover options.

Priceline CFO Daniel Finnegan noted that the buyer has cash on its balance sheet and can access the capital markets.

The companies said they expect to close the deal in the third quarter. OpenTable could have to pay a $91 million breakup fee if it terminates the deal.

Wells Fargo Securities bankers John Jinishian and Gerry Walters advised Priceline, which received counsel from Sullivan & Cromwell lawyers led by Keith Pagnani and Brian Hamilton.

OpenTable retained George Boutros, Jonathan Turner and Marcie Vu of Qatalyst Partners and Latham & Watkins lawyers Luke Bergstrom and Chad Rolston.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!
DOW 16,541.82 -21.48 -0.13%
S&P 500 1,929.07 -1.60 -0.08%
NASDAQ 4,369.0590 -0.7140 -0.02%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs