Uber-Expedia Super Deal? Our Answers to 10 Big Questions

17.10.2024 - 21:33 / skift.com / Dara Khosrowshahi / Justin Dawes / Barry Diller / Uber

A report in the Financial Times Wednesday that Uber was exploring a purchase of Expedia has everyone in the travel industry talking. If Uber were to acquire Expedia Group, it would be the biggest shakeup the travel industry has seen in years. 

And it would be Uber’s biggest deal ever. Uber has been dipping its toes into travel, but the company would be diving in head first if it bought a major online travel company. 

To be clear, it’s all speculation at this point. An Expedia spokesperson told Skift on Wednesday that the company isn’t commenting. Uber did not respond to a request for comment.

Even if it was just a trial balloon, it raises other possibilities: Expedia, a big brand with a depressed stock price, could attract other potential acquirers or activist investors. (Here’s one argument for a deal by Amazon, a fellow Seattle-based company with deep pockets.) 

Uber could seek out other targets. For example, it already has a partnership with Hopper, an Expedia competitor. 

Skift analyzed multiple angles about what a potential deal would mean for the companies and the larger travel industry, roadblocks along the way, and more. 

No formal approach has been made to Expedia, and there are currently no active discussions with Uber. 

Uber approached advisers in recent months to examine the feasibility of an Expedia deal, the FT said, citing sources.

Any approach would likely be “friendly,” with Uber CEO Dara Khosrowshahi likely recusing himself from deal talks. Khosrowshahi was Expedia Group’s CEO from 2005 to 2017, overseeing major acquisitions during that time, and has stayed a non-executive board director. Khosrowshahi is a protégé of Expedia’s executive chair Barry Diller, who owns roughly 29% of Expedia’s voting power.

Uber has a market cap of roughly $170 billion, and Expedia’s is now just above $20 billion, after a 5% jump Thursday on the news of Uber’s interest.  

A successful acquisition could take Uber multiple steps toward becoming a superapp — to the extent that such an app would be allowed in the West. 

It’s a single app with multiple services, often rideshare, transport, e-commerce, banking, messaging, food delivery, and social media all in one place. DiDi Global in China or Grab in Southeast Asia are examples, but the U.S. has not managed to develop one yet. 

Uber has been venturing more into travel primarily through partnerships with travel companies. Hopper provides a connection so that Uber can sell flights. Omio provides a connection for selling trains and buses in the UK and Spain. 

Uber has also been experimenting with boat rides, shuttles to events, and now a shuttle from Manhattan to the LaGuardia Airport. And it’s increasing investment in business travel. 

Plus, there’s Uber Eats