EU not happy with Travelport's plan to acquire Worldspan
05/08/2007|3:11:00 PM|
May 4, 2007:BRUSSELS, Belgium: The European Commission said Thursday it would investigate online travel planner Travelport´s US$1.4 billion (€1.06 billion) takeover of electronic ticketing and reservations business Worldport, saying it was worried the deal could increase travel prices.

The companies control two of only four "global distribution services" that provide information on flights and accommodation to travel agents and online booking services.

EU regulators had identified "serious concerns" because the combined company, as a provider to travel agencies, would have market shares from 40 percent to over 70 percent in Belgium, Hungary, Ireland, Italy, the Netherlands and Britain.

They said they would investigate further how the deal would affect the market and make a decision to clear or block the deal by Sept. 13.

The Commission rarely prevents takeovers but it can, and often does, ask companies to sell off units or make promises to change their business behavior.

Travelport´s Galileo system is second only to Amadeus. Buying Worldspan means the new business would have only two rivals — Amadeus and the third-placed player Sabre.

"In its in-depth investigation, the Commission will assess the effects of the reduction of the number of global distribution services from four to three and the elimination of competition between Galileo and Worldspan on competition in the European economic area, and in particular whether prices for global distribution services to travel service providers would increase," regulators said.

Travelport, which owns Orbitz and, is controlled by private equity firm, The Blackstone Group LP.

A spokesman for the company was not immediately available for comment.