RealTime IT News

Expedia Books $60 Million in Financing

Online travel provider Expedia Inc. Tuesday obtained private investments of $50 million from Technology Crossover Ventures (TCV), a leading venture capital firm, and $10 million from Microsoft Corp.

As part of the financing agreement, Expedia will issue about 3.6 million shares of common stock and 723,000 warrants with an exercise price of $16.60 in exchange for the combined investment.

The price per share is based on the average closing price of Expedia stock over the three-day trading period ending June 23,2000.

Upon completion of the financing, TCV and Microsoft will own, respectively, 7 percent and 70 percent of Expedia's common shares outstanding.

As part of the agreement, Jay Hoag, a founding general partner of TCV, will join the Expedia board of directors.

Hoag noted that online travel and lodging are extremely viable sectors in Internet commerce.

"As venture capitalists, we look for ways to build great companies that will generate long term returns," he said. "TCV believes that Expedia has the strongest strategic position in this market and a highly compelling business model."

The transaction is expected to close after the early termination or expiration of the Hart-Scott-Rodino waiting period, which will conclude no later than early August.