Texts Between Saber's Executives About Farelogix Fuel Deal US Lawsuit Antitrust Lawsuit – Skift



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The US Department of Justice is continuing to block the acquisition of Farelogix by Saber for $ 360 million. In a lawsuit filed Wednesday, federal government lawyers said they got text messages where Saber executives acknowledged that acquiring Farelogix would eliminate a competitive threat and would further strengthen Saber in the reservation services.

The day Saber announced his intention to buy Farelogix, Saber's sales manager reportedly texted a colleague to tell him that a major American airline would "hate him". The colleague reportedly replied, "Why, because it roots us more?"

In another conversation, a Farelogix executive reportedly said that the buyout of the company would allow Saber to[e] a strong competitor against continued competition and price pressure. "

"The proposed acquisition of Farelogix by Saber is the attempt of a dominant firm to take a disruptive competitor that has been an important source of competition and innovation," said Makan Delrahim, Attorney General. Assistant, Antitrust Division, Department of Justice.

Saber said that he would dispute the suit.

"Over the past two years, Saber has embarked on a strategy with a brand new management team focused on the evolution of the underlying technology of the travel ecosystem we support," said Sean Menke. President and CEO of Saber, Wednesday.

"Together, Saber and Farelogix will accelerate innovation in the dynamic and highly competitive airline technology sector, helping airlines accelerate growth and profitability while providing better service to travelers."

Last week, just before the Justice Department filed its lawsuit, Saber boldly stated that he was going ahead with the Farelogix agreement, apparently causing the regulators.

The complaint filed on Wednesday alleges that Saber and Farelogix are competing to provide airlines with a technology of reservation services that allows the sale of tickets and the sale of passengers to other products. It alleges that the "acquisition" would likely result in higher prices, reduced quality and less innovation for airlines and, ultimately, for roving US consumers. "

Proponents of Saber say the complaint distorts the competitive position of Farelogix, which generated only $ 42 million in revenue last year in a $ 5 billion computer market.

Saber stated that it offers complementary services to those of Farelogix. The company specializing in travel technology can cite various merger and purchase transactions approved by the department, because the integrations were complementary rather than focused.

Saber announced its intention to demonstrate in court that the airline technology sector was highly competitive and that many companies, even airlines themselves, were providing services.

The Department of Justice alleges that "the airlines have successfully leveraged their ability to turn to Farelogix to negotiate lower taxes with Saber and other global distribution systems. [GDSs] and reduce their reliance on GDS for reservation services. "

According to the lawsuit, Jim Davidson, CEO of Farelogix, said in 2013 that "Saber has exercised its monopoly power to try to destroy Farelogix and prevent competition."

The lawsuit alleges that last year, Davidson told European competition authorities that Saber and the other two major global distribution systems, Amadeus and Travelport, "continue to benefit from significant market power." to preserve their position in the market and curb innovation.

Earlier this week, UK authorities said they were pursuing the acquisition review because of potential antitrust concerns.

The official deposit is integrated below.

Download the file (PDF, 710Ko)

Photo credit: Outside the headquarters of the US Department of Justice in Washington, DC on Wednesday. The ministry has taken legal action to block Saber's acquisition of Farelogix for $ 360 million. Bloomberg

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