Travel tech giant Sabre has announced it has abandoned the company’s proposed US$360 million ($558 million) acquisition of Farelogix.
In a statement, Sabre president and CEO Sean Menke said: “Sabre and Farelogix have agreed to terminate the parties’ merger agreement, which expired at midnight on April 30.
“We continue to believe that the transaction was not anti-competitive, a result confirmed by the US federal district court’s decision in Sabre’s favour.
“Unfortunately, the United Kingdom’s Competition and Markets Authority (CMA) – acting outside the bounds of its jurisdictional authority – has prohibited the transaction. We strongly disagree with the CMA’s decision.”
In April, the CMA found that airlines, travel agents and UK passengers would be worse off following the merger, which it said would lead to “fewer new features that may be released more slowly” and that “fees for certain products might also go up”.
Sabre reportedly intends to appeal that decision.
The US Department of Justice had ruled in favour of Sabre, a US-based company, after it successfully defended its acquisition of Farelogix, a UK-based company.
However, according to Skift, the department had spent much of April pursuing an appeal of that decision.
That decision came in the midst of an ongoing and calamitous coronavirus pandemic, which forced Sabre to announce in March that it would reduce costs by as much as $338 million across its business.
“We remain committed to our long-term goal of creating a new market for personalised travel,” Menke said.
“Positioned at the centre of the business of travel, Sabre is a critical component of the travel ecosystem.
“We are uniquely situated to create solutions that expand the distribution access of rich content via the Global Distribution System (GDS) marketplace and also help airlines create personalised offers for their customers, including the development of NDC-enabled solutions.”
Farelogix said it was disappointed that the plan to join Sabre would not go ahead.
“However, due to the inherent uncertainty with any regulatory process, we have been well prepared for this possibility,” the company said in a statement.
“Over the past 18 months, we have made great strides in advancing our technology infrastructure, optimising our product delivery, streamlining our operational processes, and implementing new customers.”
Farelogix added that it was grateful to its airline customers who had remained supportive throughout the merger process amid the COVID-19 pandemic.
“We do not take this support lightly and continue to be laser-focused on providing airlines with superior levels of service and product innovation,” it said.
“And while the economy and travel industry have been significantly impacted by COVID-19, one thing is clear: Farelogix remains committed to quickly and creatively delivering technology solutions airlines need today and into the ever-evolving future.”
Featured image: iStock/Paul Campbell