Monday, September 24, 2001

Cheap Tickets offer
date extended

Cendant pushes back the deadline
2 weeks and gets EU approval
to purchase Galileo

By Russ Lynch

Cheap Tickets Inc. shares bounced back today after Cendant Corp. said its purchase offer of $16.50 a share has attracted about 86 percent of Cheap Tickets' stock and it will keep the offer alive for two more weeks.

Cheap Tickets, which had closed as low as $12.34 since the Sept. 11 terrorist attacks disrupted travel, ended at $16.24 today on the Nasdaq Stock Market, a gain of $1.39 or 9.3 percent for the day, with some 3.6 million shares traded.

New York-based Cendant, a travel-franchising and real estate giant, said its offer for all of Cheap Tickets' stock, which was to have closed at midnight Friday, will now close at midnight Oct. 5. The $16.50 price is unchanged.

Cendant said that by the close of the day Friday, holders had tendered 20.4 million shares of Cheap Tickets stock. Before it made the public offer Aug. 23, Cendant had already been promised about half the Cheap Tickets shares, held by company insiders.

Even though travel bookings are down, Cendant said its does not expect the acquisition of Cheap Tickets and the much-bigger acquisition of travel firm Galileo International Inc. will dilute Cendant's per-share earnings for 2002.

In the case of Cheap Tickets, management already has taken steps to improve its operating efficiency, Cendant said. On Sept. 5, for example, Cheap Tickets said it would shut its call center in Los Angeles, losing 115 employees, leaving it with four call centers: Tampa, Fla.; Honolulu; Lakeport, Calif.; and Colorado Springs, Co.

As for the planned $3.5 billion acquisition of Galileo, Cendant said today that European Union regulators have ruled that the deal does not raise antitrust concerns and the acquisition should take place on Oct. 1.

Cendant shares rose 51 cents to $11.54 today on the New York Stock Exchange and Galileo's shares were up $2.78 at $18.48.

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