US companies circle UK travel firms

Wealthy American companies are eying British travel firms in an attempt to expand their empires in the UK. Multi-million-dollar corporations such as Sabre, Priceline, Expedia and Travelport are rumoured to be bidding for a firm footing in the overseas market.

So far this year, three US firms have already made acquisitions in the UK. Hoseasons was bought for £51 million by Wyndham Worldwide in February, while online Manchester-based company Travel Jigsaw was snapped up by Priceline for an undisclosed sum in May. A month later, Expedia also got its hands on HolidayLettings.co.uk.

Expedia has boosted its war chest this week by managing to raise $750 million from bond issues. Wyndham is also sitting pretty after totting up $350 million in a securitisation. Industry insiders here indicated that the extra cash could be used for acquisitions, and there is speculation that online companies The Beach and Travel Republic could be targeted by the two firms.

James Ainley, Citigroup travel and leisure analyst, said Priceline, Expedia and other online players see Europe as a good opportunity to expand their online portfolios as travel is increasing across the continent.  He added that big American companies are seeing it as a good time to capitalise on the strength of the dollar.