Report: EU Regulators Expected to Veto Booking’s Acquisition of Etraveli

European Union (EU) regulators are reportedly poised to block Booking Holdings’ 1.63 billion euro purchase of Sweden’s Etraveli Group.

The decision comes as concerns arise about the potential consolidation of Booking’s market position and its adverse impact on competitors, the Financial Times (FT) reported Friday (Sept. 1). While the United Kingdom’s Competition and Markets Authority approved the deal a year ago, the EU’s stance reflects apprehensions about the acquisition’s effect on competition within the travel industry.

Booking, a prominent U.S.-based online travel site, announced its intention to acquire Etraveli Group in November 2021, according to the report. Etraveli, owned by private equity giant CVC, operates brands such as Gotogate and Mytrip. The acquisition was aimed at expanding Booking’s presence in the flights-only sector and potentially venturing into other services like car rentals.

EU regulators are worried the acquisition would further solidify Booking’s dominant position in the travel market, potentially harming rivals, the report said. The European Commission (EC) expressed concerns about the deal’s impact on the hotel booking sector, as it could give Booking an advantage and divert demand from alternative sales channels. Additionally, regulators fear the acquisition will create higher barriers to entry for competitors, making it more challenging for them to gain new customers.

A closed hearing was conducted where Booking attempted to address regulators’ concerns by offering concessions, per the report. These concessions included providing greater visibility to rivals on its site as alternatives for hotel bookings. However, market participants rejected these remedies, considering them insufficient to ensure fair competition. Following an in-depth probe, antitrust investigators expressed worries that the deal would strengthen Booking’s bargaining position with hotels and limit consumer choice.

An official decision on the acquisition is expected later this month, with sources indicating that the merger will likely be vetoed, according to the report.

When Booking Holdings announced its intention to acquire Etraveli, it said the Swedish company would remain headquartered in that country and would operate as an independent business under Booking.

“As international air travel rebounds from the impact of the pandemic, we look forward to building upon our existing relationship with Etraveli Group to make the travel booking experience easier and more seamless to support our partners and customers,” Booking Holdings CEO Glenn Fogel said at the time.