Tripadvisor to Acquire Parent Liberty Tripadvisor for $435 Million and Gain Independence
Skift Take
Key Points
- Tripadvisor plans to acquire its parent company, Liberty Tripadvisor Holdings, for $435 million, eliminating the dual-class stock structure.
- The acquisition will remove Liberty Tripadvisor as a controlling shareholder, providing Tripadvisor with greater strategic flexibility.
- The deal will enable Tripadvisor to pay off $330 million in senior preferred notes owed by Liberty Tripadvisor to Certares.
Summary
Tripadvisor has announced its plan to acquire its parent company, Liberty Tripadvisor Holdings, for $435 million. This move will eliminate the dual-class stock structure and remove Liberty Tripadvisor as a controlling shareholder, providing Tripadvisor with enhanced strategic flexibility. Additionally, the acquisition will allow Tripadvisor to pay off $330 million in senior preferred notes owed to Certares, marking a significant step in its pursuit of greater independence and financial stability.
Tripadvisor announced that it plans to acquire its parent Liberty Tripadvisor Holdings, meaning Tripadvisor would no longer have a dual-class stock structure and a controlling shareholder.
It would be the first time in Tripadvisor's history as a public company, which began in 2011, that Liberty Tripadvisor wouldn't be controlling Tripadvisor's destiny.
The deal is valued at $435 million.
In a complex series of financial moves, Tripadvisor is buying back the Tripadvisor stock that Liberty Tripadvisor held.
In addition, the $330 million in senior preferred notes that Liberty Tripadvisor owed to Certares gets paid off as part of the deal.
Once the deal closes, which is expected to take place in the second quarter of 2025, Tripadvisor will have eliminated its dual class structure, removed a controlling shareholder, and gained new flexibility in charting its own path.
Liberty Tripadvisor Was a Drag on Tripadvisor's Performance
Tripadvisor also won't be limited any longer by Liberty Tripadvisor's weak financial status — it was delisted from Nasdaq last year — and weighed down by Liberty Tripadvisor debt.
Tripadvisor's stock rose nearly 11% in pre-market trading.
In early 2024, Tripadvisor formed a special committee to evaluate potential mergers after Liberty Tripadvisor announced that it was considering strategic alternatives. In May, Tripadvisor announced that no such merger was forthcoming.
In August, however, Liberty Tripadvisor CEO Greg Maffei, who's also chairman of Tripadvisor, said that Liberty Tripadvisor and Certares were in talks "about transactions that might arise."
At that time, Maffei said Liberty Tripadvisor Holdings is looking to do a deal, one that could remove what he characterized as “probably a cloud on Tripadvisor’s stock.”
“We are pleased with the agreement reached with Liberty TripAdvisor, and I want to thank the Special Committee for its diligent work on behalf of all stakeholders,” said Tripadvisor President & Chief Executive Officer Matt Goldberg. “The transaction presents a unique and favorable opportunity to simplify our capital structure, create strategic flexibility, and retire a large portion of our shares, while maintaining a healthy balance sheet. We believe this transaction marks a new era for Tripadvisor and we are excited to continue to pursue our strategic vision across travel and experiences.
Photo Credit: A Tripadvisor vinyl decal on a restaurant window. Adobe Stock / MichaelVi
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