DOJ approves Expedia takeover of Orbitz
The Expedia-Orbitz deal has finally won US antitrust approval after the Department of Justice said the Expedia takeover will not adversely affect competition.
The DOJ’s antitust division had been assessing the likely impacts of the proposed deal for six months and had interviewed dozens of people in the industry.
Regulators said they don’t expect commission rates to rise as a direct result of the deal as Orbitz is not considered a major player.
"We uncovered no evidence in our investigation that the merger is likely to result in new charges being imposed directly on consumers for using Expedia or Orbitz. So we focused our investigation on the commissions Expedia and Orbitz negotiate with airlines, car rental companies and hotels," a DOJ statement said.
"Second, we found that Orbitz is only a small source of bookings for most of these companies and thus has had no impact in recent years on the commissions Expedia charges. Many independent hotel operators, for example, do not contract with Orbitz, and those hotels that do often obtain very few bookings from its site."
Once the deal is finalized, it ‘will benefit consumers and shareholders alike,’ said Chris Chiames, Orbitz’s vice president for corporate affairs.
The DOJ decision will disappoint hotel companies suspicious it is only a matter of time before commissions rise again.
Trade group The American Hotel & Lodging Association had raised its opposition and called on regulators to reject the deal, calling it ‘bad for consumers and bad for business.’
Bill Baer, the DOJ’s antitrust chief said the online travel market is evolving with instant booking tools from the likes of Google and Tripadvisor keeping the market competitive.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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