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The Priceline Group no longer has an identity crisis because it changed its name Wednesday to Booking Holdings Inc.
The company, with six major brands including Booking.com, Priceline.com, Kayak, Agoda, Rentalcars.com and OpenTable, will scrap its PCLN stock symbol and start trading under the handle BKNG on Nasdaq February 27. It will still be headquartered in Norwalk, Connecticut and no operational changes come with the new corporate identity.
Company officials mulled the change for years because too many people, including potential investors, associated the Group with its original incarnation in the form of U.S.-focused Priceline.com even though Amsterdam-based Booking.com accounts for “a significant majority” of Booking Holdings gross bookings and operating profit, the company said. Booking Holdings declined to say precisely how much.
The Acquisition of Booking.com
The root of the name change is tied to Priceline.com’s acquisitions in 2004 and 2005 of Active Hotels and Bookings B.V., which were the greatest acquisitions in online travel history and probably among the top three in Internet history in terms of annualized return.
When Jeremy Schaal, an equity portfolio manager at Jarislowsky Fraser, looked at this issue for Skift in June 2017, he estimated that the greatest Internet-era acquisitions in terms of annualized return were Facebook’s purchase of Instagram, then Google’s buy of Android, and in third place was Priceline.com’s acquisition of Booking.com.
Booking Holdings CEO Glenn Fogel told Skift there was no particular tipping point to spur the corporate name change, which reflects “a 20-year evolution of the company.” He said the new name will align the parent company with its largest brand, and the word “booking” describes what each of its major subsidiaries actually do as they help consumers explore the world.
Booking.com operates in more than 220 countries, lists 1.5 million hotel, apartments and vacation rental properties, and crunches more than 1 million bookings per day on average, the company said.
Fogel said the company has been thinking of creating the new identity periodically “for forever,” and that now that he’s been CEO for a year, it was an appropriate time to make the change.
“We are at a defining moment in our company’s history,” Fogel said in a prepared statement. “Making this change to more accurately align our company name with our largest business and connect our collective brands to a name that reflects their shared capability to help customers book amazing experiences, as well as better reflect the truly global operation that we have become today.”
Fogel told Skift the company considered “a host of names” and consulted outside experts on the move, which wasn’t expensive to make. There is no marketing campaign tied to the new name.
Fogel said the new name doesn’t change anything operationally for the company, although he hopes it creates more awareness for Booking.com in the United States, and for the entire scope of Booking Holdings in far-flung locales from London to Shanghai. He wouldn’t predict what the financial impact might be over the long term.
Jay Walker’s Priceline.com
Priceline.com, founded by Jay Walker, debuted in 1997 and a short time later launched its Name Your Own Price airline ticket service in the United States. The idea was that airlines could tap incremental demand from bargain-hungry consumers who could be flexible about their leisure travels. Walker detailed the origins of the company in Skift’s Definitive Oral History of Online Travel.
But, the pivotal moments in Booking Holdings’ history occurred in 2004 and 2005 when it bought UK-based Active Hotels and then Amsterdam-headquartered Bookings B.V., respectively, and combined them into Booking.com. The hotel-booking site used a pay-at-the-hotel business model and deployed search engine marketing to leapfrog into being the top accommodations-seller in the world.
Jeremy Schaal of Jarislowsky Fraser noted that Priceline.com purchased Bookings B.V. in 2005 for around $135 million. He estimated for argument’s sake that if Booking.com value is 75 percent of Booking Holdings’ $92.4 billion market cap, then Booking.com’s worth would be around $69 billion.
That’s not too shabby for a $135 million acquisition. Even if one includes the $165 million buy of Active Hotels in 2004 — because Priceline.com combined Bookings B.V. and Active Hotels to create Booking.com — that’s still a gargantuan return on investment.
This isn’t the first name change for the parent company.
In 2014, Priceline.com Inc. changed its name to The Priceline Group Inc. The company at the time included five of its six main brands, and added OpenTable for its sixth later in 2014.
Fogel emphasized that today’s name change to Booking Holdings does not reflect a diminished role for Priceline.com, which has been undergoing a transition over the last couple of years.
Priceline.com had become associated with actor William Shatner over the years because he was a longtime staple in the brand’s advertising. Despite their affection for Shatner, though, officials from the parent company sometimes shuddered when investors associated the entire operation with U.S.-focused Priceline.com.
In 2016, the latest figure available, 88 percent of Booking Holdings’ consolidated gross profit was generated internationally, and a “substantial majority” of that emanated from Booking.com.
Today, that reality led to a change of identity.