Skift Take
HomeAway, which is way behind, but pushing hard to improve its e-commerce capabilities, is beginning to feel some heat from Booking.com on one side and Airbnb on the other. You could therefore look at this follow-on public offering as a defensive move. On the other hand, HomeAway's acquisition spree is an aggressive tack, and the public offering signals that HomeAway has no intention of slowing down.
A week after acquiring its main competition in Australia, Stayz, for $198 million in cash, HomeAway announced it intends to carry out a follow-on public offering of 5.5 million shares of its common stock, a move that likely would net more than $200 million.
The company’s common stock closed at $39.90 per share yesterday.
HomeAway says it intends to use the net proceeds for “general corporate purposes, which may include acquisitions or license of, or investment in, products, services, technologies or other businesses.”
HomeAway’s existing shareholders intend to offer an additional 518,630 shares, plus an additional 902,794 shares to cover over-allotments. HomeAway’s wouldn’t receive any proceeds from the share sale by existing stockholders.
HomeAway’s intent to sell 5.5 million shares of its common stock, subject to market conditions, comes after two major developments.
The company has been on an acquisition tear, buying multiple vacation rental sites, including the purchase of Stayz, in Europe and Asia-Pacific throughout 2013, and Priceline’s Booking.com has been making very serious inroads in the vacation rental sector.
Booking.com, the largest lodging site in the world, revealed last week that 22% of its more than 384,000 properties are vacation rentals, and that’s a looming challenge for HomeAway’s dominance in vacation rentals.
Booking.com has greatly accelerated the amount of vacation rentals it is offering over the last year.
While initial public offerings get all the attention, and HomeAway raised around $216 million when it went public in 2011, the follow-on offering that HomeAway announced yesterday, if successful, could raise a comparable amount of funds.
All of those acquisition don’t come cheap. The Stayz Group is the 22nd vacation rental company that HomeAway has acquired since its founding in 2004.
HomeAway’s Buying Spree
| Acquisition | Country | Year | Price (Millions) |
|---|---|---|---|
| Stayz | Australia | 2013 | $198 |
| Bookabach | New Zealand | 2013 | N/A |
| Travelmob | Singapore | 2013 | N/A |
| Toprural | Spain | 2012 | $19.3 |
| Second Porch | U.S. | 2011 | $3 |
| RealHolidays.com.au | Australia | 2011 | $2.1 |
| Escapia | U.S. | 2010 | $10.3 |
| Instant Software | U.S. | 2010 | $27.1 |
| Alugue Temporada | Brazil | 2010 | $14.5 |
| BedandBreakfast.com | U.S. | 2010 | $31.6 |
| Homelidays.com | France | 2009 | $45.9 |
| EscapeHomes.com | U.S. | 2008 | N/A |
| Ownersdirect.co.uk | UK | 2007 | N/A |
| VacationRentals.com | U.S. | 2007 | N/A |
| Abritel.fr | France | 2007 | N/A |
| VRBO* | U.S. | 2006 | $160 |
| FeWo-Direkt.de | Germany | 2005 | N/A |
| Holiday-Rentals.co.uk | UK | 2005 | N/A |
| TripHomes.com | U.S. | 2005 | N/A |
| A1Vacations.com | U.S. | 2005 | N/A |
| GreatRentals.com | U.S. | 2005 | N/A |
| CyberRentals.com | U.S. | 2005 | N/A |
Note: HomeAway didn’t specifically disclose the acquisition price for VRBO, but bought it through a $160 million debt and equity financing deal in 2006.
Source: HomeAway
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Tags: booking.com, homeaway, ipo
Photo credit: It's been a very busy year for HomeAway CEO Brian Sharples, who has given the thumbs up on acquisitions of the Stayz Group in Australia, Bookabach in New Zealand, and Toprural in Spain in 2013 alone. Now HomeAway is trying to raise $200 million to fund some more buys. CNBC/Mad Money