RESERVATIONS NETWORK TO ACQUIRE TRAVELNOW.COM
Distribution Play: HRN's Internet Affiliate Base To Increase From
4,000 to 16,000 Total Affiliates-
January 4, 2001 - Dallas, TX and Springfield,
Hotel Reservations Network (HRN) (NASDAQ: ROOM), the Internet's
number one provider of discount hotel accommodations worldwide,
and TravelNow.com (NASDAQ: TNOW), a leading Internet travel site
with one of the largest travel affiliate programs on the web, announced
today that they have entered into a definitive merger agreement
pursuant to which HRN will acquire all of the outstanding shares
of TravelNow for $4.16 per share in cash. Including shares of TravelNow
that were previously purchased by HRN, as well as certain other
contractual payments in the transaction, the total value of the
acquisition is approximately $47.4 million.
The merger brings together two companies in
the online travel industry that have the largest and most successful
affiliate distribution networks on the Internet, with a combined
total of over 16,000 affiliate partners. Both companies will benefit
from the premier distribution network created by this merger and
the opportunity to provide their products and services to millions
of new customers.
The merger agreement provides that, by no
later than January 18, 2001, HRN will commence a tender offer for
all outstanding shares of TravelNow's common stock. The Board of
Directors of TravelNow has unanimously approved the merger agreement
and recommends that shareholders tender their shares into the tender
"Like HRN, TravelNow has been very successful
in growing its business rapidly through the use of the Internet
affiliate distribution model," said Bob Diener, President of
Hotel Reservations Network. "The combination of the two companies
will create an enormous distribution platform from which HRN can
aggressively build upon its leadership position in the online hotel
accommodations market. In addition, TravelNow, will be able to provide
many of HRN's other affiliates and consumers with access to a broader
array of travel products including car rentals, air travel, rail
passes and cruises."
Mr. Diener continued, "In addition to
expanding our distribution base and product offerings, this transaction
further strengthens the revenue and cash flow generating momentum
inherent in HRN's unique and profitable business model. Leveraging
HRN's infrastructure, we have identified several areas where we
expect to be able to increase the sales and profits of both HRN
and TravelNow. Further, our financial position remains solid. Following
the close of the transaction, we will still have over $130 million
in cash and no debt. We look forward to working with our new partners
at TravelNow and welcome them to the HRN family."
Jeff Wasson, Chief Executive Officer of TravelNow.com
said, "The merger between two of the most successful travel
distribution networks allows for the rapid growth and clear leadership
position of a stronger entity. The opportunity to form such a relationship
gives both TravelNow and HRN clients a greater value proposition.
From technology and customer service offerings to discounts and
combined resources, this is an opportunity that does not happen
very often. The complete advanced technology solution that encompasses
the best network and the widest, fastest service will ultimately
benefit the traveler."
The tender offer is subject to customary conditions.
The offer is not subject to receipt of financing. Upon successful
completion of the tender offer, the agreement calls for a merger
pursuant to which any remaining shareholders will receive cash in
the same amount as paid in the tender offer. TravelNow will become
a wholly-owned subsidiary of HRN and its management team will remain
intact. The acquisition is expected to close by the end of the 1st
quarter of 2001.
HRN will host a conference call to discuss
this announcement at 1:00 p.m. Eastern time on January 4, 2001.
To access the call please dial 212-346-6440. In addition the live
call will be available over the Internet at www.hoteldiscount.com
under the Investor Relations section. The call will be archived
at the same website and will be available within 48 hours.
Hotel Reservations Network, Inc. (NASDAQ: ROOM) is the Internet's
#1 provider of discount hotel accommodations and supplier of room
availability during sold out periods. In addition, HRN provides
travellers with access to vacation rentals, including vacation timeshare
properties, condominiums and other managed vacation properties.
HRN supplies travellers with an easy-to-use, one-stop source for
the guaranteed lowest hotel rates and vacation rentals through its
Websites, over 4,000 affiliate Websites, and HRN's 24x7 toll-free
call center (1-800-96-HOTEL). HRN provides hotel accommodations
at over 2,100 hotels in more than 83 major markets in North America
and Western Europe and vacation rentals at approximately 100 properties
in 13 markets. Located in Dallas, Texas, HRN is a majority-owned
subsidiary of USA Networks, Inc.'s (NASDAQ: USAI) Information and
Launched in 1995, TravelNow (NasdaqSC: TNOW) was among the very
first real-time hotel reservation services on the Internet. TravelNow
was also the first Internet travel site to provide consumers with
the capability to initiate a wireless hotel reservation. Through
its network of over 12,000 affiliates, as well as its own Website,
TravelNow provides competitive rates for more than 40,000 hotels
in 5,000 cities and 140 countries. Additionally, the Company offers
discounts of up to 65 percent on 700 hotels in almost every major
city and up to 40 percent on over 7,000 hotels around the world.
In addition, TravelNow offers car, air, rail and cruise reservations.
For investor relations or press information please visit investor.travelnow.com.
news release contains "forward-looking statements" regarding
HRN. HRN has based these forward-looking statements on its current
expectations and projections about future events, based on the information
currently available to it. The forward-looking statements include
among other things, statements relating to HRN's anticipated financial
performance, business prospects, new developments, new strategies
and similar matters. These forward-looking statements are subject
to risks, uncertainties and assumptions that may affect the operations,
performance, development and results of HRN's business and include,
but are not limited to, the risk factors described under the section
"Risk Factors" in HRN's prospectus filed with the SEC
on February 25, 2000 (which is available upon request from HRN or
on HRN's websites, www.hoteldiscount.com
under the heading "Investor Relations") and the following:
1) material adverse changes in the economic conditions in HRN's
markets; 2) future regulatory actions and conditions in HRN's operating
areas; 3) competition from others; 4) product demand and market
acceptance; 5) the ability to protect proprietary information and
technology or to obtain necessary licenses on commercially reasonable
terms; and 6) the ability to obtain and retain key executives and
employees. HRN undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information,
future events or any other reason. In light of these risks, uncertainties
and assumptions, the forward-looking statements discussed in this
press release may not prove correct.
in this press release contains forward-looking statements regarding
TravelNow.com that involve risks and uncertainties that might adversely
affect the Company's operating results in the future to a material
degree. Such risks and uncertainties include, without limitation,
the ability of the Company to raise capital to finance the development
of its software products, the effectiveness and the marketability
of its services, the ability of the Company to protect its proprietary
information, and the establishment of an efficient corporate operating
structure as the Company grows. These and other risks and uncertainties
are presented in detail in the Company's Form 10-KSB, which was
filed with Securities and Exchange Commission on October 12, 1999.
This information is available from the SEC or the Company.
announcement is neither an offer to purchase nor a solicitation
of an offer to sell securities of TravelNow.com. The tender offer
will be made pursuant to a tender offer statement and related materials.
Investors and security holders are strongly advised to read both
the tender offer statement and the solicitation/recommendation statement
regarding the tender offer referred to in this news release when
they become available because they will contain important information.
The tender offer statement will be filed by HRN with the Securities
and Exchange Commission (SEC), and a solicitation/recommendation
statement will be filed by TravelNow.com with the SEC. Investors
and security holders may obtain a free copy of these statements
(when available) and other documents filed by TravelNow.com and
HRN at the SEC's website, www.sec.gov,
and available from HRN upon request.
in this press release contains forward-looking statements that involve
risks and uncertainties that might adversely affect the Company's
operating results in the future to a material degree. Such risks
and uncertainties include, without limitation, the ability of the
Company to raise capital to finance the development of its software
products, the effectiveness and the marketability of its services,
the ability of the Company to protect its proprietary information,
and the establishment of an efficient corporate operating structure
as the Company grows. These and other risks and uncertainties are
presented in detail in the Company's Form 10-KSB, which was filed
with Securities and Exchange Commission on October 12, 1999. This
information is available from the SEC or the Company.
For Hotel Reservations Network:
Fuhr & Associates
Hotel Reservations Network
214-361-7311 ext 1034