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Nov 4 (Reuters) - Expedia Inc on Wednesday said it agreed to buy vacation rental site HomeAway Inc for about $3.9 billion in cash and stock, in a move that could ramp up competition with apartment-sharing startup AirBnB.
Expedia, the world’s largest online travel services company by bookings, said it offered $10.15 in cash and 0.2065 per share of its own stock for each share of HomeAway it acquires.
Expedia, which recently closed a deal to acquire Orbitz Worldwide Inc, said it expects the HomeAway deal to close in the first quarter of 2016, subject to regulatory approval.
“We have long had our eyes on the fast growing $100 billion alternative accommodations space and have been building on our partnership with HomeAway, a global leader in vacation rentals, for two years,” Chief Executive Dara Khosrowshahi said in a news release.
Khosrowshahi said on an investor call last week that AirBnB has had an “immaterial” impact on Expedia’s business so far, although excess inventory has pressured prices in some markets.
He had said listings of apartment rentals will become “incrementally” important in coming years as Expedia competes for the customers that use AirBnB, who typically are younger and more price sensitive.
Cowen and Co analyst Kevin Kopelman said in a research note last week that AirBnB could pose a greater threat to the likes of Expedia by 2018, if AirBnB reaches its revenue targets. (Reporting by Jeffrey Dastin in New York and Ankit Ajmera in Bengaluru; editing by Sayantani Ghosh, Bernard Orr)