In a varied week of deals, the tech acquisitions landscape continues to demonstrate its diversity. Undoubtedly, the deal of the week goes to Priceline for its behemoth acquisition of a restaurant booking business, underlining the value of intermediary booking platforms. Meanwhile, Yandex acquired online classifieds platform Auto.ru in Russia, a sign of a growing consolidation spree by the local majors. Sell businesses should see good opportunities in the BRIC country as a spree for market share continues. Finally, Cisco jumped on the Internet of Things (IoT) bandwagon with its purchase of Tail-f systems.
Travel bookings major moves into the restaurant business
Priceline Group, one of the world’s largest hotel and airline bookings providers, has expanded its core business by adding a restaurant reservation service to its portfolio. The group is set to purchase OpenTable for $2.6 billion in cash. The number of restaurants using OpenTable in North America is growing but the number globally is falling as the company has been unable to sustain a strong marketing drive internationally in the face of local rivals. OpenTable charges $1 for each booking completed through its service. In the first quarter of this year, OpenTable lost $3.6 million on revenues of $53 million. Priceline is following the lead of its competitor TripAdvisor, which purchased restaurant booking service Lafourchette for $140 million.
Yandex moves into classifieds with purchase of Auto.ru
Russia’s dominant search engine Yandex (which controls around 60% of Russia’s search market) has expanded its interests into the online classifieds arena by purchasing the number-one auto classifieds in the country, Auto.ru, for $175 million. The move marks a growing demand for market share as Russia’s cash-rich internet holdings expand interests. The Mail.ru Group, for example, has purchased local social media network VKontakte, while Yandex bought movie listing site KinoPiosk in January this year. Auto.ru was founded in 1996 and the site currently lists more than 400,000 unique cars for sale. Since the retirement of its CEO and founder last year, Auto.ru has been under increasing pressure from its rivals and the acquisition should provide a new boost of liquidity. Russia has the largest car market in Europe by volume of sales.
Cisco enters the Internet of Things
With the likes of Apple and Samsung making their entry into IoT, a number of other tech giants are following suit as the potential value of this new segment is expanding by the day. Cisco is one of these, bolstering its IoT business with a $175 million acquisition of Stockholm-based Tail-f Systems. The company is representative of an increasingly strong tech contingent coming out of Scandinavia, especially in the devices and FinTech arenas. Tail-f Systems helps users manage network devices using a single interface and will be integrated into Cisco’s global cloud and virtualisation business.
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