Sabre Raises $627 Million in Its IPO, Lower Than Expectations
Sabre Corp., the travel software and data company that operates the Travelocity website, raised $627 million in its initial public offering, pricing a reduced number of shares below the marketed range.
The company, which says its technology processed more than $100 billion of estimated travel spending last year, sold 39.2 million shares for $16 each, according to a statement today, after offering 44.7 million for $18 to $20 apiece.
Sabre, which has posted annual losses for at least the past five years, is going public as increased competition has led to lower fees and as long-term debt has swelled to more than $3 billion. In an effort turn things around, Sabre entered an agreement in August with Expedia Inc. to process bookings through that platform instead of Travelocity’s, which will cut revenue from that unit while also trimming costs.
“I believe this is part of Sabre’s focus on becoming a more profitable organization,” Ron Josey, an analyst at JMP Group Inc., who has the equivalent of a hold rating on Expedia, said by phone before the offering. “Expedia is powering the bookings, and it gives them a lot more data.”