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DOJ lawsuit seeks to block Farelogix sale to Sabre
As expected, the Department of Justice filed a civil antitrust lawsuit aiming to block Sabre Corp’s $360 million acquisition of Farelogix Inc.
The DOJ described the deal as a predatory action of ‘a dominant firm’s attempt to take out a disruptive competitor.’
That is a bad deal for competition, it says.
"If allowed to proceed, the acquisition would likely result in higher prices, reduced quality, and less innovation for airlines and, ultimately, traveling American consumers," said DOJ antitrust division assistant attorney general Makan Delrahim.
Sabre’s previous strategy had been to ‘shut down Farelogix’ the filing claims.
"Sabre has wielded its monopoly power in an attempt to destroy Farelogix and prevent competition."
"Now that Farelogix has gained a foothold in booking services and is poised to grow, Sabre seeks to eliminate this scrappy competitor once and for all by acquiring it."
Sabre will contest the lawsuit.
"Sabre and Farelogix offer complementary services, and this transaction is the continuation of an already successful collaboration," Sabre said.
Sabre said it has pledged not to increase prices of Farelogix products ‘for a period of time after the transaction.’
Expecting the DOJ legal challenge, Sabre last week extended the termination date of the acquisition agreement to April 30, 2020.
It is now preparing a formal response to the DOJ complaint.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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