TRIPV Tripadvisor, Inc. (MM)

By Tess Stynes and Drew FitzGerald 

Priceline Group Inc. agreed to weave much of its hotel inventory into TripAdvisor Inc.'s new booking platform, offering the travel review website a potentially massive source of new business.

The collaboration marks a softening of earlier resistance from Priceline to the TripAdvisor's Instant Booking product, which allows travelers to reserve rooms without ever leaving its website. Priceline executives said as recently as August that they were wary of working with the new platform because it could draw customer attention away from its brands.

Both companies said the deal emerged after months of negotiations. Financial terms of the partnership weren't provided.

The first Priceline brand to join TripAdvisor's new platform will be Booking.com, a website that dominates the online travel business in Europe and generates the biggest share of its parent's profits. In a news release Wednesday, the companies said that Priceline.com and Agoda.com also are likely to list inventory on the platform.

TripAdvisor shares surged more than 20% to $81.09 early Wednesday. Priceline slid 1.9% to $1,319.

TripAdvisor, which was spun off in 2011 from Expedia, launched the Instant Booking feature on its website to U.S. consumers in June 2014, with a gradual rollout to other international markets expected over time.

The travel site spent the past year amassing support for its booking service from big hotel chains like Marriott International Inc. with the promise of more control over their customer relationships and lower commissions. Hotels have long complained that third-party websites take too big a cut of their revenue, but they rely on the websites to market their rooms to travelers.

Both TripAdvisor and Priceline have been facing increased competition for customers from established hoteliers to startups such as Airbnb Inc. TripAdvisor and Priceline both have been expanding their offerings through acquisitions in recent years.

Meanwhile, Priceline rival Expedia has bulked up with its $1.3 billion takeover of rival Orbitz Worldwide Inc.

The Orbitz acquisition left Expedia and Priceline in control of the majority of the top third-party travel-booking websites in the U.S.

Write to Tess Stynes at tess.stynes@wsj.com and Drew FitzGerald at andrew.fitzgerald@wsj.com

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(END) Dow Jones Newswires

October 14, 2015 12:29 ET (16:29 GMT)

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