Travelocity to acquire world choice travel assets from MYTravel Group, PLC

In a move that will broaden its merchant model hotel distribution capabilities, Travelocity(R) and its parent company Sabre Holdings (NYSE:TSG) today said they had reached a definitive agreement to acquire the assets of World Choice Travel (WCT), the U.S.-based hotel room consolidation and distribution business of MyTravel Group PLC.

My Travel is a global leisure travel services company based in the United Kingdom. Travelocity expects to close this transaction in the fourth quarter of 2003, subject to regulatory and other customary approvals. Upon closing of the transaction, approximately 160 WCT employees with significant expertise in hotel room distribution will become members of the Travelocity team.

After closing, the $50 million cash transaction is expected to be slightly accretive to Sabre Holdings earnings per share on an adjusted basis in 2004 and beyond, and neutral to slightly dilutive in 2004 on a GAAP basis due to the amortization of certain intangibles.

The proposed acquisition of assets is expected to generate additional tax deductions that will effectively reduce Sabre Holdings cost of the acquisition by approximately $13 million, to approximately $37 million. After consideration of the net present value of this tax savings, the price of the business being acquired equates to six to eight times estimated 2004 EBITDA.

"By expanding our distribution capabilities, we can offer more customers more great deals and additional services while helping our partners sell their products to an even broader set of consumers," said Travelocity CEO Sam Gilliland.

"Combined with our strong and growing merchant hotel offering, this new asset puts us on a path to additional growth in hotel sales. And, this transaction also offers us additional distribution capabilities for other high-yield products, including our TotalTrip(SM) dynamic packaging and Last Minute Deals."