Articles tagged “farelogix”

For years, a handful of large airline groups outside of the U.S. have slapped surcharges on airfare sold via legacy technology. Hawaiian is the first U.S.-based airline to add distribution surcharges.

Vista, the investor behind this merger of airline tech vendors Accelya and Farelogix, is no private equity tourist. The firm has committed tens of billions to technology businesses, and it shows signs of having the wherewithal to grow Accelya into a long-term player in airline tech services.

Farelogix CEO Jim Davidson says the pandemic presents opportunities. Yet despite that brave face, it's hard to see Farelogix facing anything but revenue declines during the crisis now that it's lost the Sabre acquisition.

This decision is no surprise. The world has changed a lot since November 2018, when Sabre first proposed buying travel tech vendor Farelogix. Actions by antitrust watchdogs in the UK and the U.S. delayed the deal's approval. Then coronavirus hurt Sabre's finances.

We read the 100-page rulings on the proposed merger of Sabre and Farelogix so you don't have to. Airlines want to take over a lot of the tech work from Sabre and its rivals and pay travel agencies directly for bookings. American Airlines says the new model has already saved it millions. But the rulings found few tech vendors up to the task.

Sabre's arguments that UK regulators would merely fall in line if a U.S. court backed Sabre's merger with Farelogix were naive. The UK ruling was essentially correct about the proposed deal stifling innovation, and somewhere airlines are quietly celebrating the ruling.

Sabre and Farelogix paid $20 million in lawyers' fees in 2019 to respond to U.S. government reviews of their proposed merger and to defend against antitrust proceedings. Is there an antitrust case to be had against Big Law?

As Sabre fights to acquire Farelogix, it's important to examine exactly why intermediaries are beginning to scoop up the companies built to disintermediate them.

A federal judge heard closing arguments in the U.S. government's antitrust suit to block Sabre's acquisition of Farelogix. Inside the courtroom, Judge Leonard Stark's comments didn't show his hand. The case seems a close call.

It's notable that we had a much easier time finding experts who supported Sabre's proposed merger of Farelogix than opponents. But this court case will be decided on legal nuances, and its outcome is impossible to predict. We pity the judge who has to endure this crash course in airline technology and distribution.