Priceline to buy OpenTable for $2.6 billion
The definitive agreement to buy OpenTable is an all cash transaction values OpenTable at $2.6 billion.
The deal is $0.8 billion higher than what Priceline paid for US metasearch giant Kayak in late-2012.
OpenTable makes reservations more than 31,000 restaurants worldwide and claims to be helping around 15 million restaurant goers each month.
On mobile alone, OpenTable says it has seated seating more than 125 million customers since it first introduced reservations via devices in 2008. It has apps for Apple, Android, Blackberry and Windows operating systems.
Priceline CEO and president Darren Huston says:
“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.
“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.”
Priceline says OpenTable will continue to be operated from its San Francisco offices, retain its existing management team and run as an independent business within the wider group.
In its Q1 earnings, TripAdvisor CEO Steve Kaufer described the segment as “extremely under-penetrated”.
OpenTable CEO Matt Roberts says:
“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 expected to close in the third quarter of 2014, subject to regulatory clearance in the US.
OpenTable was created in 1998 and saw a significant growth spurt following the acquisition of TopTable in 2008 (with the latter rebranding to its new owner shortly after). With 600 staff in tow, OpenTable now has a presence in almost 20 markets around the world, including China, Canada, Japan, Ireland and Mexico.
The company claims its reservations have generated $20 billion for restaurants.
Running within the heart of the reservation platform is the user generated content aspect, with a dizzying 400,000 reviews contributed to the site every month by customers.
Kevin May is a senior editor and one of the co-founders at Tnooz. He was previously editor of UK-based magazine Travolution and web editor of Media Week UK from 2003 to 2005.
He has worked in regional newspapers (Essex Enquirer) and started his career in journalism at the Police Gazette at New Scotland Yard in London. He has a degree in criminology, a postgraduate diploma in magazine journalism and will be publishing his first book - a biography about electronic band, Depeche Mode - soon.