Booking Holdings plans to appeal EU decision to block Etraveli acquisition
tupungato/iStock Editorial via Getty Images
The European Commission announced on Monday it is blocking leading online travel company Booking Holdings (NASDAQ:BKNG) from acquiring Sweden's flight booking provider Etraveli Group because it would have allowed it to increase its dominant position on the market on the continent.
The European Commission said it had warned Booking Holdings (BKNG) about its concerns, but that the remedies offered by the company were not sufficient. The EC said its investigation found out the proposed â¬1.63 deal would have led to higher costs for hotels, and possibly, a negative impact on the price paid by consumers.
"Bans are rare, and todayâs decision is in fact the first merger to be blocked this year," stated European Union Justice Commissioner Didier Reynders said.
Following the EC announcement, Booking Holdings (BKNG) disclosed that it intends to appeal the decision to prohibit the acquisition of Etraveli Group from CVC Capital Partners.
Booking Holdings (BKNG) statement: "The Company strongly believes the Commission is wrong on both the facts of the case and the law applicable to this transaction, which was cleared unconditionally by multiple competition authorities, including the UK Competition & Markets Authority and U.S. FTC. The Commission has fundamentally misconstrued the highly competitive travel markets for flights and accommodations, and its decision is an unexplainable departure from the Commission's own Non-Horizontal Merger Guidelines, which are legally binding on the Commission. The acquisition, which would have combined two separate but complementary Europe-based businesses operating within separate, highly competitive industries, would have delivered tremendous benefits for consumers and partners by bringing more options and competitive pricing. Booking Holdings regrets very much the lack of convergence of the European Commission with other major international enforcers on this pro-competitive transaction."
Shares of Booking Holdings (BKNG) were up 0.10% to $3,064.78 in premarket trading on Monday.

More on Booking Holdings

Seeking Alphaâs Quant Rating on Booking Holdings
Financial information for Booking Holdings
Booking: Appears Undervalued Despite The Rally
Booking's Tailwinds Remain Impressive With Great Upside Potential
Booking: Yeah, We Like This One! Here's Why