Travelzoo Rumored Selling To Priceline

| About: Travelzoo Inc (TZOO)
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A quick update on the Travelzoo (NASDAQ:TZOO) rumor. Reuters is reporting that options traders say the rumored suitor for the company is Priceline (PCLN).

One sell-side analyst who formerly covered the company reports that the primary value in TravelZoo is the company’s list of 10 million subscribers to its Travelzoo Top 20 weekly email.

“Every one of those subscribers has “opted in” to receiving the letter, which makes it very attractive considering all of the scrutiny that lead-gen techniques like (VCLK)’s are receiving from the FTC,” says the analyst, who declined to be identified for internal compliance reasons since he does not formally maintain coverage of the stock. “Travel companies love the ‘Top 20′ because it is a high-ROI way to dispose of last-minute inventory; –since travel companies' costs are fixed for the most part, the incremental margins on this remnant inventory are very high. By definition, the inventory is limited to ‘Twenty’ spots, and competition for it has become pretty fierce. Is it worth $400 million? No idea, – depends how much it would cost to replicate from scratch.”

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