Oct 17, 2024 19:00:00

Uber is considering buying Expedia to turn it into a super app, which would be Uber's biggest acquisition to date

Uber , the ride-hailing and food delivery service provider, is considering acquiring travel booking service Expedia , British economic media Financial Times reported.

Uber explored possible bid for Expedia in 'super app' growth push
https://www.ft.com/content/94a25bf7-e62b-462a-a4f0-e4feb6e244f7

The Dream Deal: Uber Exploring Buying Expedia, Says FT
https://skift.com/2024/10/16/the-dream-deal-uber-exploring-buying-expedia-says-ft/

Expedia stock jumps on report of acquisition interest by Uber - MarketWatch
https://www.marketwatch.com/story/expedia-stock-jumps-on-report-of-acquisition-interest-by-uber-808da5d6

According to information obtained by the Financial Times from people familiar with the matter, Uber has been considering a takeover bid for Expedia for the past few months. Three anonymous sources familiar with the matter said Uber is in the early stages of buying Expedia, and that the company has approached Expedia with a takeover bid through a third party. Uber has not formally approached Expedia, and no talks are taking place between the two companies, the Financial Times reported.

Uber's acquisition approach is expected to be 'friendly,' and Uber CEO Dara Khosrowshahi is likely not to be involved in the acquisition negotiations. The reason is that Khosrowshahi met Expedia Chairman Barry Diller when he was young and worked under him. Khosrowshahi also served as Expedia's CEO from 2005 to 2017 and is currently a non-executive director of the company.

As of 2024, Uber's market capitalization is expected to be $173 billion (approximately 25.9 trillion yen), while Expedia's is expected to be about $19.68 billion (approximately 2.95 trillion yen). Therefore, if the acquisition is realized, it is likely to be Uber's largest acquisition to date.

Expedia lowered its earnings forecast due to the sluggish popularity of vacation rental booking site

Vrbo in the first quarter (January to March) of 2024 and 'weak travel demand' in the second quarter (April to June). Expedia has been touting plans to consolidate its brands onto a single platform for over a year, and although the plan is complete, the benefits have yet to be seen.

However, Expedia Group's combined room nights across its brands, including Hotels.com and Vrbo, increased 10% in the second quarter of 2024, the largest increase in more than a year, and outpaced competitors Airbnb and Booking Holdings .

In an interview with news media Skift in October 2021, Uber CEO Khosrowshahi revealed that Uber is looking to expand into areas such as train and plane bookings.

Uber CEO Dara Khosrowshahi at Skift Global Forum 2021 - YouTube


The acquisition of Expedia would significantly expand Uber's business and consumer reach and strengthen its efforts to become a ' super app ' with new avenues for growth.

When Skift reached out to Expedia for comment on the acquisition, the company declined to comment. MarketWatch has reached out to both Uber and Expedia for comment, but Expedia said it 'does not comment on rumors or speculation,' and Uber did not respond to a request for comment.

Following the acquisition news, Expedia's shares soared 7.2% in after-hours trading on Wednesday, October 16th.