Headline: Wotif.com could be a vulnerable target for overseas rivals - report Main body :
Wotif.com, the Australian online hotel booking business, could be a target for its large overseas rivals, the Australian Financial Review reported. According to the unsourced report in the paper’s Street Talk column, Wotif’s share price has fallen to its lowest level since the business listed in 2006. The report noted that the fall may have made Wotif vulnerable to an overseas competitor such as Expedia, Priceline, or Orbitz. The article claimed that there are believed to be fears within Wotif that it would be nearly defenceless should an offer emerge.
The item claimed that Wotif is currently involved in a turnaround strategy, but it will take time to play out. The report said that a buyer could offer a 30% premium to Wotif’s current price of AUD 2.68 per share and come away with the business cheaply.
Wotif would provide an overseas operation instant access to Australia.
The item noted that any deal would rely on the support of Wotif’s co-founders Graeme Wood and Robert Brice. The pair still own a combined 35% of the business.
Wotif has a market capitalisation of AUD 567m (USD 505m).
WTF Price at posting:
$2.63 Sentiment: ST Buy Disclosure: Held
