Travel-booking company Sabre Holdings, owner of the Travelocity site, is in advanced talks to be sold to private equity investors for more than $4 billion, according to a New York Times report this morning. Two investor groups are competing to buy Sabre: the favorite is a group led by Silver Lake Partners and Texas Pacific Group, with a rival bid led by Apollo Group. Sabre was originally American Airlines' reservation system, but now serves all the major air carriers. This would be the second recent, major private equity acquisition in the travel reservation industry -- just last week Blackstone-owned Travelport, which operates Orbitz.com and CheapTickets.com, agreed to buy Worldspan, which operates reservation systems for Delta and Northwest, for $1.4 billion. Steady cash flow attracts private equity investors to this sector. A $4 billion price tag would represent an approximate 7% premium to Sabre's Friday closing price of $28.32.
• Sources: New York Times, Wall St. Journal
• Related commentary: Bloomberg: Travelport Agrees to Buy Worldspan for $1.4 Billion, NYT: Travelport Expands With Worldspan Deal Conference call transcripts: Sabre Holdings Q3 2006
• Potentially impacted stocks and ETFs: Sabre Holdings (TSG) Competitors: Priceline (PCLN), Expedia (EXPE), Travelzoo (TZOO), Ctrip.com (CTRP)
Seeking Alpha's news summaries are combined into a pre-market briefing called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only a few seconds to sign up.