Tarvelport Ltd., the parent of travel services firm Orbitz, is buying Atlanta-based Worldspan in a deal that values Worldspan at $1.4 billion.
Both companies offer global travel solutions.
“Increasing cost pressures on travel suppliers and agencies combined with the strengthening of alternative distribution channels, such as supplier direct channels, continue to influence how travel is purchased,” said Jeff Clarke, Travelport’s chief executive officer. “This merger will create a more effective and efficient travel distribution provider and will ensure that we are better positioned to meet the evolving needs of our customers, the travel suppliers, travel agencies and end consumers.”
Rakesh Gangwal, chairman and CEO of Worldspan, will leave the combined company when the merger is completed.
The combination of the companies is expected to produce savings of $50 million a year.
Travelport reported revenues of $2.4 billion in 2005.
Both companies are privately held.