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Google bolsters online travel offer with $700m acquisition

Google has agreed terms to buy online travel search company ITA Software in an estimated $700m (£461m) deal, which will allow the internet giant to move in to the lucrative airline reservations sector.

Google: set to acquire ITA Software

Google: set to acquire ITA Software

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The all-cash deal will place Google in direct competition with Microsoft’s Bing Travel search site.

However, the deal has still to be rubber-stamped by federal anti-trust regulators in the US, and is likely to take between six months and a year to be passed.

ITA software is based in Cambridge, Massachusetts and has several offices within the EMEA region, including a headquarters in Amsterdam.
It employs 500 people worldwide and was formed in 1996 by a group of computer scientists from the Massachusetts Institute of Technology. ITA sells technology that helps run the reservations systems of several major airlines including Continental, Southwest, American and Alaska airlines.

This isn't the first Google acquisition to come under intense scrutiny. Regulators took nearly a year to approve the company's $3.2bn (£2,1bn) buyout of online ad service DoubleClick in 2008, and six months to push through its recent $750m (£495) takeover of mobile ad service AdMob.

Writing on the Google blog, Marissa Mayer, vice-president, search products and user experience, said: "Today, almost half of all airline tickets are sold online. But, for many people, finding the right flight at the best price is a frustrating experience; pricing and availability change constantly, and even a simple two-city itinerary involves literally thousands of different options. We’d like to make that search much easier."

Mayer added: "While online flight search is rapidly evolving, we think there is room for more competition and greater innovation. Google has already come up with new ways to organise hard-to-find information such as images, newspaper archives, scholarly papers, books and geographic data.

"Once we’ve completed our acquisition of ITA, we’ll work on creating new flight search tools that will make it easier for you to search for flights, compare flight options and prices and get you quickly to a site where you can buy your ticket."

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