Sabre to Buy Farelogix for $360 Million

Travel technology giant Sabre is buying Farelogix, an airline distribution technology specialist, for about $360 million in the largest deal in a few years in the airline distribution business.

Sabre, based in Southlake, Texas, has hundreds of airline customers worldwide using its services for distribution and operations. By buying its once bitter rival Farelogix and its technology and engineers, Sabre said it hopes it will be able to push airlines to more quickly adopt the latest tools and methods for selling their services via online and offline travel agencies. It's also a tacit admission that Farelogix's technology was superior in many ways to its own.

The companies announced the deal Wednesday morning.

"This deal will help drive the renaissance of Sabre," said Dave Shirk, executive vice president and president of Sabre's Travel Solutions division.

Sabre said that the approximately 225 workers at Farelogix, headquartered in Miami, will be brought over as a wholly-owned subsidiary after the deal is closed in late 2018 or early 2019.

The deal represents Sabre's first acquisition under CEO Sean Menke, who became CEO in January 2017. Menke and Shirk began talks with Farelogix CEO Jim Davidson about nine months ago.

"When Sean Menke and Dave said that they wanted Sabre to be the world's leader in e-commerce and retail not just for airlines but for the travel industry, they had me right there," said Davidson. "They were clearly serious... and they realized that to reach that goal they had to look at their platform differently."

To say that Farelogix and Sabre have been "frenemies" for many years is something of an understatement.

Farelogix has sold many products, but one that was especially popular enabled airlines, starting most prominently with Air Canada, to distribute their content directly to agencies, partly by bypassing technology middlemen like Sabre and its peers Amadeus and Travelport.

American later filed a lawsuit against Sabre for alleged bullying, and during the case it included in its testimony a Sabre PowerPoint slide that said, "Our goal is to one, not let Farelogix spread any further and number two, to discontinue the current locations."

It cited a November 2008 statement by a Sabre executive, who internally said, "We want