OpenTable Gains on Report of Yahoo Acquisition Interest
The shares advanced 6.4 percent to $46.36 at the close in New York, the biggest increase since Aug. 3. The stock has climbed 18 percent this year.
Yahoo management, led by Chief Executive Officer Marissa Mayer, “appeared to show interest” in OpenTable as an acquisition candidate, Reuters reported yesterday, citing a person it didn’t identify. Mayer has said she wants to bolster Yahoo’s technology and engineering expertise since she took the helm in July. OpenTable, which focuses on consumer services, may do little to further that goal, said Tom Forte, an analyst at New York-based Telsey Advisory Group.
“OpenTable from a technology standpoint is about transitioning from making reservations by phone to making reservations by the Internet,” Forte said in an interview. “Yahoo seems to more interested in something that’s more engineering focused –- tech heavy.”
Sara Gorman, a spokeswoman for Sunnyvale, California-based Yahoo, and Tiffany Fox, a spokeswoman for San Francisco-based OpenTable, declined to comment.
OpenTable, which gets fees from restaurants for each diner booked through its service, has experienced slowing sales growth as the weak economy has led consumers to curb spending. The company’s enterprise value is currently $976 million, about half what it was worth at the end of the second quarter of 2011.
Yahoo finished the third quarter with cash and short term investments of $9.4 billion.
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