Sabre Holdings Corporation (NYSE: TSG), the world leader in travel marketing and distribution, today announced that it has entered into an agreement to acquire GetThere, Inc. (Nasdaq: GTHR) in an all cash tender offer for all outstanding shares of GetThere common stock at $17.75 per share, or $757 million. The acquisition will bring together the top two players in the online business-to- business corporate travel channel and the business-to-consumer e-commerce channel for airlines, travel suppliers and travel agencies.
GetThere would be combined with the Sabre Business Travel Solutions (BTS) unit to create the industry’s leading online travel platform for corporations and suppliers, with leading-edge technologies, innovative services and content, and an unparalleled roster of blue-chip customers. Upon closing of the transaction, the new Sabre company will operate under the GetThere name and will be based in Menlo Park, California. Gadi Maier, current GetThere chairman, president and CEO, will be president of the combined organization, and will report to Hannigan.
“This acquisition will establish Sabre as the category leader in the fast growing online corporate and supplier Web site space,” said William J. Hannigan, chairman, president and chief executive officer of Sabre. “Together, we will bring expanded benefits to customers, suppliers and shareholders. Our combined technology and expertise will enable us to offer the broadest range of services and content, and to create enhanced revenue- generating opportunities in a rapidly changing marketplace.”
“We are pleased that Gadi Maier has agreed to lead this new Sabre company and look forward to working with him as a key member of our senior management team,” said Hannigan.
“By combining the competencies and resources of both GetThere and Sabre, we can deliver unparalleled services globally,” said Gadi Maier. “Together, we will accelerate the proliferation of online travel technology and continue to revolutionize the travel industry.”
The acquisition will bring together an extensive list of customers, representing an estimated $28 billion in travel and entertainment spending. Corporate customers, which include Boeing, Chevron, Cisco Systems, Citicorp, Dell, General Electric, Lucent, Nike and Nortel, have already reduced their travel expenses by up to 30 percent through the implementation of tools from Sabre and GetThere. In addition, travel suppliers and retailers leverage the technology capabilities of GetThere and Sabre to deliver best in class consumer Web sites. These customers include major airlines such as United Airlines, America West, US Airways and Swissair, and retailers such as American Express, Cheap Tickets and Travelocity.com.
Under the terms of the agreement, which was unanimously approved by GetThere’s board of directors, the transaction will include a tender offer, which is expected to commence during the week of September 4, 2000. The transaction is expected to close in the fourth quarter of 2000, subject to regulatory clearance and customary closing conditions.
The combined businesses will have estimated 2000 revenues of approximately $50 million and are anticipated to help fuel Sabre’s growth over the long term. The financial impact of this acquisition, coupled with the cost-savings of approximately $100 million generated from the Sabre’s worldwide cost- cutting initiative described below, will have a neutral impact to earnings in 2001.
Sabre has made a number of recent strategic investments in support of its strategy to be the premier electronic travel marketing and distribution company. Earlier this month the company acquired Gradient Solutions Limited, a Dublin, Ireland based technology company that provides e-commerce solutions to the global travel marketplace. In June, the company announced the acquisition of a 51 percent ownership in Dillon Communications Systems, the fastest-growing supplier of electronic travel distribution in Germany. Earlier this year the company merged Preview Travel and Travelocity.com, creating the clear leader in the consumer online travel channel.
In a separate announcement today, Sabre also announced a worldwide cost- cutting initiative designed to position the company for increased growth and profitability. The company-wide program supports an effort launched several months ago to improve efficiencies and flatten the organization, thereby increasing speed and agility. The plan includes the elimination of approximately 1200 jobs over the next several months, through a combination of attrition and layoffs, and is expected to bring annual savings of $100 million beginning in 2001.