Orbitz Plans to Seek Strategic Alternatives for AwayAri Levy
Orbitz Worldwide Inc., the online travel agency, said it’s exploring strategic alternatives for its Away Network, including a possible sale of the group of websites.
A sale of some or all of the assets wouldn’t have a material impact on earnings for 2013, the Chicago-based company said today in a statement. Away Network includes the websites Away.com, Trip.com and AdventureFinder.com.
Orbitz is struggling to keep up with Priceline.com Inc. and Expedia Inc., which have more sucessfully expanded out of the lower-margin airline business into hotel reservations. Orbitz has lost more than half its market value in the past three years, and reported a loss of more than $300 million in the fourth quarter because of an impairment charge.
“As we assess the prioritization of investments in different areas of our business, in particular in the context of the encouraging trends that we’re seeing in hotel, we’ve made the determination that the elements of the Away Network, either collectively or individually, are likely to be more valuable to other parties,” Sam Fulton, senior vice president of product strategy at Orbitz, said in the statement.
Orbitz rose as much as 5.1 percent to $3.50 in extended trading after the announcement. As of the close, Orbit had a stock market value of $349.8 million, compared with $35 billion for Priceline and $8.8 billion for Expedia.
Away is one of the five brands Orbitz lists on its corporate site’s homepage. In addition to its flagship brand, they include CheapTickets, ebookers.com and HotelClub.