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The Priceline Group found the sixth company to fill the chair at its table of portfolio companies, agreeing to acquire OpenTable for $2.6 billion, a Priceline spokesperson confirmed.
“Our companies are built on similar foundations,” Priceline Group spokesperson Leslie Cafferty told Skift. “we both work tirelessly to deliver a supreme digital booking experience for our customers and world-class marketing solutions for our partners, so this is a natural extension for the Group.”
“The kind of work that we do day-to-day is very similar,” Priceline CEO Darren Huston said in an interview with the Wall Street Journal, which broke the story. “It’s just a different marketplace.
The move takes place only several weeks after TripAdvisor acquired European restaurant reservations platform lafourchette.
Only a few days ago Huston was musing about how the company was actively considering adding a big acquisition to find a company to work in the Group along with Booking.com, Kayak, Priceline.com, Agoda and Rentalcars.com.
The Priceline Group found it in OpenTable, the restaurant reservations platform that attracts some 15 million restaurant reservations monthly.
In an SEC filing, OpenTable stated that on June 12 its “supporting stockholders,” Matthew Roberts, I. Duncan Robertson, Michael Dodson, Joseph Essas, A. George “Skip” Battle, J. William Gurley, Robert Hohman, Thomas Layton, Daniel Meyer and Paul Pressler agreed to the Priceline Group’s tender offer, and OpenTable agreed to terminate any alternative proposals with unspecified third parties.
The Wall Street Journal reported that the Priceline Group agreed to offer OpenTable $103 per share in an all-cash deal, and that would be a 46% premium over its closing share price June 12.
The deal, which is expected to close in the third quarter, is larger than the Priceline Group’s 2013 acquisition of Kayak for $2.1 billion.
The deal immediately puts the Priceline Group into competition with Yelp and TripAdvisor, among others, in the restaurant space — a relatively new arena for the Priceline Group.
But, it makes total sense and it has much to do with the mobile revolution.
The agreement to acquire OpenTable is about mobile, and the push by TripAdvisor and now Priceline to fully engage their customers on the go when they are already in a destination — or when they are traveling for business.
Huston said as much recently, explaining that mobile is about engagement and not just about bookings.
Intriguingly, in a recent presentation, Huston mentioned in passing that the Priceline Group thinks about business travel — an area that it hasn’t targeted openly — but OpenTable is an attractive acquisition as a means to capturing the allegiances of business travelers as they are mulling their dining options.
OpenTable already has a huge customer base — 620 million diners, according to its website.