Booking Holdings Buys Activities Distribution Startup FareHarbor
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Only a couple of years ago, the CEO of family-owned activities distributor FareHarbor said the company would never sell. But never say never. For Booking Holdings, this is further proof that the giant wants to be full-service.
In what looks to be the biggest deal yet in the tours-and-activities distribution space, Booking Holdings said Thursday that it will acquire U.S.-based, experiences booking-software provider FareHarbor.
The FareHarbor acquisition will help provide content to expand Booking.com's upselling of consumers on tours after the consumers have already bought another product from the online travel giant.
Terms of the deal were not disclosed. FareHarbor, headquartered in Hawaii, claimed to have generated more than $50 million in revenue last year — roughly double the revenue of a year prior. It had more than 200 employees at the time of the acquisition and claimed to be profitable.
The price tag could be relatively “hefty” — as in more than $300 million — speculated one source who is knowledgeable about the tours and activities sector. The reason is that FareHarbor has a substantial footprint in the distribution and reservation management parts of the sector.
TripAdvisor is believed to have made several offers, including one last year, to buy FareHarbor for well over $200 million, including cash, stock, and incentives
TripAdvisor’s loss of the deal may not be a complete wash, though. "While Booking Group's size, heft, and sales presence could allow it to sign-on activity partners directly, we also see an opportunity for TripAdvisor to partner with Booking and Expedia for distribution, said research analysts at investment bank SunTrust Robinson Humphrey.
TripAdvisor uses FareHarbor, along with other similar providers, to receive content from operators.
It may wait long to make its own countermove to defend its market leadership in this sector, one source speculated.
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