Expedia’s $703M Wotif bid comes under scrutiny

Company News

Australia’s competition regulator has outlined a number of issues with the proposed takeover of online travel booking company Wotif.com Holdings Limited’s (ASX:WTF)
US online travel giant Expedia Inc (NASDAQ:EXPE) launched a $703 million takeover of the company in July which was backed by Wotif’s directors. 

The Australian Competition and Consumer Commission (ACCC) says it is now seeking more information to determine if the transaction is likely to substantially lessen competition. 

The ACCC has highlighted concern from market participants that the removal of Wotif as an independent competitor will allow Expedia to increase its commission rate. 

The corporate watchdog has invited further submissions ahead of the final decision which has now been deferred until October 2, 2014. 

Wotif has affirmed its commitment to work with the ACCC to resolve any issues identified. 

Wotif’s net profit fell 15 per cent to $43.2 million in the 2014 financial year.