Cendant to buy ebookers for $415m - WSJ

In for the long haul

Cendant, the US travel giant, is to buy ebookers for $415m, the Wall Street Journal claims. This works out at around $6.17 (320p) per share, a modest premium on yesterday's closing price of 312p.

ebookers, the UK's biggest online travel business, also has a big longhaul bricks and mortar travel business. It has grown through acquisition, and has sought cost synergies by migrating more sales onto the web, cutting jobs and by consolidating back offices functions in India.

But ebookers has not mastered the knack of actually making money on a regular basis. And it has had a torrid time this year, with shares falling as low as 115p in the summer. Its current share price is underpinned largely by the bid speculation that has surrounded the company since September.

That was when it anounced it was in talks with a number of potential bidders. In October, InterActive Corp, owner of Expedia.com, announced that it was not prepared to make a bid, sending ebookerS shares down 4.7 per cent on the day from 216.50p to 195p.

Cendant recently bought Orbitz, America's second biggest online travel business, behind only Expedia, for $1.25bn. The group owns the Ramada hotel chain and a big traditional travel agency business.®

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