Summarize this content to 2000 words in 6 paragraphs
Who’d want to buy Tripadvisor and parent Liberty Tripadvisor?
It turns out that in the year since Tripadvisor announced a sales process, five parties submitted non-binding preliminary bids.
One from a strategic bidder, identified as Party 7 in a financial filing, came just six days ago — one month after Tripadvisor’s announcement in December 2024 that it intends to buy parent Liberty Tripadvisor for $435 million.
It proposed to pay cash for all shares of Tripadvisor not owned by Liberty Tripadvisor for $18-$19; to buy Liberty Tripadvisor’s common stock for $0.3080 per share, and to buy LTRIP’s preferred shares for $102 million.
A Tripadvisor special committee decided it was not in its best interests to entertain the offer.
The five bids came from strategic parties and “financial sponsors,” which were not identified. At one point, Apollo was reported to be in the mix as a suitor.
Liberty Tripadvisor disclosed the information about bidders in a proxy filing Thursday.
As part of Tripadvisor’s pending acquisition of Liberty Tripadvisor, which is slated to close by June 2025, the $330 million in senior preferred notes that that Liberty Tripadvisor owes Certares would get paid off. Certares, which has stakes in Amex GBT, Hertz, and Internova Travel Group among others, became a strategic investor in Liberty Tripadvisor in April 2021.
Tripadvisor reached out to 19 strategic parties and financial sponsors starting in December 2023 when it began considering strategic alternatives.
Five of them submitted non-binding bids over the next 13 months for sums ranging from $17.50 to $30 per share. The deal announced in December is for $16.21 per share.
Most of the parties that submitted preliminary bids eventually withdrew from the process. One strategic bidder exited the process saying the transaction structure was too complex. Tripadvisor ultimately decided not to engage with the latest one.
In May 2024, when Liberty Tripadvisor and Tripadvisor had no suitor, Liberty Tripadvisor management discussed a bankruptcy filing, among other strategic alternatives.
Is There Another Tripadvisor Deal in the Future?
BTIG Research issued an investor note Thursday rating Tripadvisor a “buy.” The rationale is that Tripadvisor’s acquisition of Liberty Tripadvisor would eliminate the complex capital structure where Liberty Tripadvisor controlled Tripadvisor.
“There was clearly a decent amount of interest in TRIP,” the BTIG note said. “Now that it is in the process of securing the voting shares held by LTRIPA and paying down the debt-preferred, it should be easier for those same financial sponsors to consider a deal for a post-deal TRIP.”
Correction: There were five companies that submitted non-binding bids, not six as we initially reported. Certares submitted several proposals, but they were geared to facilitate a merger of Tripadvisor and Liberty Tripadvisor, and were not designed to acquire those companies.
