Expedia is set to buy HomeAway, a competitor to Airbnb, for $3.9 billion following a two-year partnership. Unlike Airbnb, which allows people to rent out their homes on a short-term basis, HomeAway focuses on vacation rentals, charging property owners to list their rentals.
“It’s clearly a product that’s important for a certain group of people, so we will look to build out our rental product over time,” Expedia CEO Dara Khosrowshahi told Bloomberg Business analysts in a conference call last week.
Founded in 2005, HomeAway lists 1.2 million vacation rental properties across the world and had a net income of $10.4 million in the third quarter of 2015, the company reported Wednesday. Following the acquisition, HomeAway stated it will be changing its business model, charging travelers a fee based on a sliding scale, which is expected to add an average of 6% to most transactions, Bloomberg Business reports.
This is the third travel-booking brand Expedia has acquired this year. In September, Expedia bought Orbitz Worldwide for $1.6 billion, and earlier this year purchased Travelocity from Sabre Corporation for $280 million, according to the New York Times. Also included in the Expedia family are Hotels.com, Hotwire.com, and Trivago.
Both companies expect to close the deal sometime in the first quarter of 2016.AM