Microsoft Corp said yesterday that it will spin off its internet travel booking service, Expedia.com into a public company, raising an estimated $75m from the sale of an undisclosed number of shares. Microsoft will retain a majority shareholding in the company according to Expedia’s statutory pre-IPO filing with the Securities and Exchanges Commission. Subsequent filings will reveal the number of shares on offer and their price.
Expedia has racked up $700m worth of gross bookings since its launch in October 1996, serving an estimated 860,000 customers. As of last month it had seven million registered users. The service comprising web sites for travelers from the US, Canada, the UK and Germany tracks the lowest travel fares and hotel rates along with providing travel news and timetable information. Expedia’s SEC prospectus cites findings from Forrester Research, which estimate that online travel transactions will be worth $32bn in 2004 from around $7.8bn this year.
The $75m figure was quoted in the filing as a basis for calculating the SEC registration fee. The transaction will incur a non-cash charge of up to $150m as the 128 Microsoft employees that are transferring to Expedia have their Microsoft stock options exchanged for new ones in Expedia.
