Acquisitions Heat Up in Hotel Tech

NATIONAL REPORT—Major mergers and acquisitions have been ongoing in the tech world for some time now, and that showed no sign of letting up in the fourth quarter.

Earlier this month, Expedia completed its acquisition of HomeAway, Inc., on the heels of purchasing Orbitz Worldwide, Inc. “Whereas our past acquisitions were about adding to our demand portfolio, HomeAway is a bit of a different acquisition in that it’s adding to our supply portfolio,” Expedia CEO Dara Khosrowshahi told Hotel Business, noting that he views the rise of HomeAway and similar sites as an evolution in lodging.

“People always want to talk about disruption. We view this more as an evolution,” he said, likening it to the rise of independent hotels via the Internet, where online players introduced a new set of hotels to international travelers. “Our acquisition of HomeAway was simply about increasing our addressable supply footprint in response to online technology standardizing new inventory. It positions us very well and I think the lodging and hospitality industry, in general, will adjust as it always has historically.”

HomeAway will be seen as a new platform added to Expedia’s family of companies with lots of cross promotion, according to Khosrowshahi. “There will be inventory sharing—you’re going to see the HomeAway inventory on Expedia, Hotels.com, etc. And, I do expect that we will test some of the apartment-type inventory that we have signed up on the Expedia and Hotels.com platform… on the HomeAway platform as well,” he said.

As hotels seek stronger engagement and targeted communication with guests, the industry saw hospitality tech provider TravelClick acquire ZDirect, a creator of a customer relationship management platform. This is the second acquisition by TravelClick in the last 12 months. The company will integrate ZDirect and the new solution will be made available to the company’s 38,000 hotel clients globally in an effort to expand its reach and market adoption, according to the company.

“Data and SaaS technology are core to everything that we do. The addition of ZDirect will serve as a platform for innovation and is a tremendous opportunity for TravelClick to help our hotel clients stay competitive in an ever-changing marketplace and thoroughly understand their past, current and future customers,” said Larry Kutscher, CEO, TravelClick. “Combining our rich, data-driven suite of solutions with ZDirect’s market-proven CRM results in a unique end-to-end platform will allow hotels to increase profits through better engagement.”

In other technology acquisitions news, Constellation Software, Inc. (CSI) acquired Springer-Miller Systems, Inc., a provider of property management systems for hospitality. In the deal, Springer-Miller will operate under the Jonas Group of companies within Constellation.

“CSI has been very successful in acquiring businesses like ours, positioning them as a platform and then growing that vertical. What that means for this company is taking our heritage products and using that as a platform for additional growth and additional acquisitions underneath a new vertical,” said Larry Hall, president and CEO of Springer-Miller at the time of the sale. (Michael McCarthy has since taken on the role.) “That is just a terrific opportunity for the company, particularly given a lot of the turmoil that’s in the industry today. There are a lot of good companies out there smaller than ours that would make a good strategic fit, and CSI has the financial wherewithal and skills to cause those to happen. That’s the exciting part of this transaction. This company is in a good spot to grow, expand and really have a far more dominant role in the industry.”

Elsewhere, Sabre Corporation is set to buy Trust Group of Companies, a hotel marketing, central reservations and revenue management firm. The purchase could advance the company’s presence as the world’s largest central reservations system provider, according to the company.

“The technology needs of the hospitality industry are evolving at a rapid pace. Hoteliers want a global technology provider that anticipates their needs and delivers broad, integrated solutions, including data and analytics, retailing and guest engagement,” said Alex Alt, president of Sabre Hospitality Solutions. “By bringing together Sabre and the Trust Group, we will immediately expand our capabilities and increase the pace of innovation we deliver to the industry.”

In addition, Ruckus Wireless, Inc. purchased Cloudpath Networks, a provider of secure WiFi onboarding software. Cloudpath’s software will be integrated with Ruckus’ Smart WiFi portfolio for hospitality, education, enterprise and retail markets.

 

Corris Little