Expedia shares rally on takeover rumor
CHICAGO (Reuters) - The shares of online travel agency Expedia Inc (EXPE.O) were up more than 9 percent in afternoon trade on Tuesday amid speculation that the company could be a takeover target for Google Inc (GOOG.O).
"Call buyers surfaced in Expedia Inc this morning as unsubstantiated rumors surfaced stating that Google Inc could make a bid for the company," said Susquehanna Financial Group's market intelligence team in a note to clients.
The talk was prominent in the equities options market where sentiment was 67 percent bullish as about 8,000 calls compared with 600 puts changed hands in Expedia, seven times the normal combined volume, according to option analytics firm Trade Alert.
Expedia's April $22.50 and $25 calls, giving investors the right to buy Expedia shares at $22.50 and $25 apiece. The options active on talk Google might be interested in the company, said independent options trader Frederic Ruffy.
Expedia is the largest U.S. online travel agency. Its shares were up 9.46 percent at $23.96 in late afternoon trading on Nasdaq, but still down more than 30 percent from their peak in October last year.
An Expedia spokeswoman said the company does not comment on rumors and speculation.
The shares of rivals Priceline.com Inc (PCLN.O) and Orbitz Worldwide Inc (OWW.N) were up 5.54 percent and 4.35 percent, respectively.