Deal of the Week: to buy for $1.38B

Announcement Date  February 12, 2015 Acquirer  Expedia Inc. (Nasdaq: EXPE) Acquirer Description  Operates as an online travel company in the and internationally. Brands include Expedia.com, Hotels.com, Hotwire.com, Classic Vacations and  Founded in 1996 and headquartered in Bellevue, Acquirer Financial  Mkt Cap: $11.7 billion  LTM EBITDA: $752.4 million Statistics  EV: $11.3 billion  LTM EV / Revenue: 1.9x  LTM Revenue: $5.8 billion  LTM EV / EBITDA: 15.1x Target Company  Orbitz Worldwide (NYSE: OWW) Target Description  Operates as an online travel company worldwide. Brand portfolio includes Orbitz and CheapTickets in the United States; ebookers in Europe; and HotelClub and RatesToGo internationally  Founded in 2000 and headquartered in , Target Financial  Mkt Cap: $1.3 billion  LTM EBITDA: $139.2 million Statistics  EV: $1.6 billion  LTM EV / Revenue: 1.7x  LTM Revenue: $932.0 million  LTM EV / EBITDA: 11.2x Price / Consideration  Price: $1.38 billion  Consideration: Cash Target Advisor  Qatalyst Partners Rationale  Expedia said it expects the Orbitz deal, which has an enterprise value of $1.6 billion, to add 75 cents to earnings and generate cost savings of $75 million  Acquiring Orbitz will bring not only that company’s namesake brand but also CheapTickets and HotelClub, as well as the corporate travel site Orbitz for Business  “We are attracted to the Orbitz Worldwide business because of its strong brands and impressive team,” said , Expedia’s President and CEO. “This acquisition will allow us to deliver best‐in‐class experiences to an even wider set of travelers all over the world.” Deal Points  Under the terms of the deal, Expedia will pay $12 a share in cash, 24 percent higher than Orbitz’s closing price on Wednesday  Including debt the transaction represents an enterprise value of ~$1.6 billion Of Note  The Orbitz deal follows Expedia’s purchase of online travel site Travelocity for $280 million in cash in January  The transaction further solidifies the American market for online travel booking to two companies, Expedia and the much bigger Priceline Group

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