Expedia to spin-off TripAdvisor as separate unit

The world's largest online travel agency, Expedia Inc, has unveiled plans to spin-off its TripAdvisor business as a separate entity to unlock value for its rapidly growing travel site.

The stock markets welcomed the move and the company's scrip shot up significantly in after-hours trading. TripAdvisor, besides allowing travellers to post reviews, enables flight searches and offers links to hotel and flight bookings.

Following the spin-off, Expedia would continue with the domestic and international operations of its travel brands including Expedia.com, Hotels.com, Hotwire and carrentals.com. The deal is expected to be completed by the third quarter of the current fiscal.

TripAdvisor operates on an advertising-based model and the split will help it operate independently. According to a company spokesperson, the move would allow the two units to be pure plays and to focus on their respective areas. Expedia does not plan to sell TripAdvisor.

Dubbed the 'Big daddy of online travel,' Expedia entered India a few weeks ago through Expedia.co.in. It launched a brand campaign showcasing its world-class suite of products and the world's largest inventory of over 130,000 hotels, more than 430 airline partnerships and over 5,000 holiday activities for the Indian consumer.

According to the company, Expedia currently commands the largest share of international travellers coming into India through any online travel portal. The company announced plans to spend up to Rs25 crore on marketing and branding activities, along with its special introductory offer of 'Zero Expedia fee' for the Indian consumer.