Doft & Co. v. Travelocity.com Inc.

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This appraisal case was brought after the merger of Travelocity.com and Sabre, which made Travelocity a wholly owned subsidiary of Sabre.

Retained by Morris, Nichols, Arsht & Tunnell

This appraisal case was brought after the merger of Travelocity.com and Sabre, which made Travelocity a wholly owned subsidiary of Sabre. The plaintiffs alleged that Sabre’s tender offer for the publicly held shares of Travelocity was unfair and inadequate for Travelocity’s former minority shareholders, and that Sabre had breached its fiduciary duties to those shareholders.

The court relied on many of Professor Gompers’ conclusions in its ruling on Travelocity’s value.

Counsel for Sabre retained Cornerstone Research and Professor Paul Gompers of the Harvard Business School to value Travelocity. Professor Gompers testified about his valuation and assessed the opposing expert’s valuation. The court relied on many of Professor Gompers’ conclusions in its ruling on Travelocity’s value, finding “Gompers’ detailed analysis of Travelocity’s risk and expected future growth rates reasonable” and that “Gompers provides detailed and reasonable calculations for both Travelocity and Expedia’s financial multiples, and the court agrees that these multiples are appropriate in comparing the companies.”

Case Expert

Paul A. Gompers

Eugene Holman Professor of Business Administration,
Harvard Business School,
Harvard University;
Senior Advisor, Cornerstone Research