Priceline will eat up OpenTable for a $2.6 billion tab

The companies share the same customers, Priceline CEO says

Online travel site Priceline is adding restaurant bookings to its menu of offerings with the US$2.6 billion all-cash acquisition of OpenTable. The deal has been approved by the boards of both companies and is expected to close in the third quarter.

"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 president and CEO Darren Huston said in a statement Friday.

OpenTable books more than 15 million dining seats per month and covers some 31,000 restaurants, Priceline said.

The $2.6 billion price tag represents a 46 percent premium over OpenTable's closing share price on Thursday.

Priceline has differentiated itself from rivals such as Expedia by giving customers the opportunity to negotiate prices. Shares of Priceline fell 1.24 percent in early trading Friday to $1,210.28.

OpenTable had been on Priceline's radar for some time, Huston said Friday during a conference call. The price tag is justified as OpenTable will bring an "appropriate level of return" to Priceline over the long term, he added.

"Their business model is very similar to ours," he said. In addition, Priceline and OpenTable essentially share the same customers, as travelers are also diners, he said. "We believe there's opportunity to cross-promote to the same customer base."

Priceline should also be able to help OpenTable expand internationally, Huston said.

The combined company may soon face fresh competition from Reserve, which is backed by Garrett Camp, co-founder of ridesharing service Uber. Reserve's website is currently bare-bones but teases that "a better dining experience is coming."

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags cloud computingMergers and acquisitionsinternetbusiness issuessoftwareapplicationsindustry verticalsInternet-based applications and servicesInternet service providersPricelineOpenTable

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Chris Kanaracus

IDG News Service
Show Comments

Cool Tech

SanDisk MicroSDXC™ for Nintendo® Switch™

Learn more >

Breitling Superocean Heritage Chronographe 44

Learn more >

Toys for Boys

Family Friendly

Panasonic 4K UHD Blu-Ray Player and Full HD Recorder with Netflix - UBT1GL-K

Learn more >

Stocking Stuffer

Razer DeathAdder Expert Ergonomic Gaming Mouse

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?