Thursday, December 07, 2006

Travelport-Worldspan unite - at last

We're glad to say that after pounding this story for a few days it appears some of us were spot on from the beginning. Phew

The only part we got wrong was the day of the announcement.

The pair have just announced that they will indeed "merge", although in reality that means Travelport will pay $1.4 billion for the deal and a further $125 million has been handed to Worldspan as part of a recapitalisation programme.

Travelport chief executive Jeff Clarke says in a press release:

"Increasing cost pressures on travel suppliers and agencies combined with the strengthening of alternative distribution channels, such as supplier direct channels, continue to influence how travel is purchased."

"This merger will create a more effective and efficient travel distribution provider and will ensure that we are better positioned to meet the evolving needs of our customers, the travel suppliers, travel agencies and end consumers."
Clarke stays on as the new chief executive. Current Worldspan boss Rakesh Gangwal will quit once the integration process is complete.

As for the rivals? Check the Sabre share price.

UPDATE: An interesting piece of analysis from Norm Rose on the Travel Technology Blog, especially with regards to Gangwal.

Kevin May, editor, Travolution

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