Priceline.com to acquire Kayak Software Corp for $1.8 bn

Priceline.com, a travel facilitating website, today said that it will acquire Kayak Software Corp for $1.8 billion in a cash-and-stock deal in order to gain access to Kayak's internet and mobile technology.

Under the terms of the deal, Priceline is paying $40 per share, a 29-per cent premium over its closing price of $31.04 yesterday, valuing the New England-based company at $1.8 billion.

Priceline will pay approximately $500 million in cash and $1.3 billion in equity and assumed stock options.

Founded in 2004 and backed by venture capital firms, including Sequoia Capital, Kayak is a leading travel research site that allows people to easily compare hundreds of travel sites at once when searching for flights, hotels, and rental cars, and gives travellers choices on where to book.

The Concord, Massachusetts-based company reported $224 million in revenue last year and processes over 100 million user queries each month through its global websites and through mobile applications.

Kayak pioneered internet applications that allow users to easily compare the result of travel searches from several different websites and soon became popular not only for its fast downloads of search results from several different sites, but for its mobile app that compares prices across travel sites at lightening speed.