SynXis Corp., a company that provides hotels with systems to manage their reservations, agreed to be acquired by Sabre Holdings Corp. for $40 million in cash, the companies said yesterday.
In buying the McLean firm, Sabre would get 6,000 small and medium-size hotels as customers, as well as the technology they use to track inventory, book guests online and connect to Internet reservation services, including Sabre's Travelocity.
Sabre plans to sell the technology to hotel chains and to expand listings of SynXis properties on Travelocity. Hotels use the company's core technology to consolidate bookings that come from diverse sources such as travel agents, the Internet, phone reservations and walk-ins. SynXis also operates individual hotel booking sites on the Internet.
James Kelly, a retired technology consulting executive, founded the privately held company in 1996 based on an idea from his wife, Janet Bennett, who was a travel writer and is now fashion and beauty editor for washingtonpost.com.
Kelly, who left his post as chief executive of SynXis in July but stayed on as vice chairman, called the sale bittersweet. He said the company was "the last man standing" after recently buying a competitor and watching another get snatched up last year by Pegasus Solutions Inc., a global reservation services provider.
Kelly said he did not know how much he and others would take away from the deal. He said that he owns about 8 percent of common shares and that nobody owns more than 10 percent of the company. He said other winners in the deal would be preferred shareholders George Soros, the billionaire investor, and Washington Investment Partners.
Soros was the first major investor in SynXis, putting in about $2 million in 1999 in the company's first major round of financing, Kelly said. All told, Kelly said, Soros and Washington Investment Partners contributed approximately $2.5 million each, making them the biggest investors in three rounds that produced more than $20 million in financing, much of it even as the technology market crashed.
Scott Brodows, vice president of car and hotel distribution for Sabre, said SynXis would be a standard operating unit of the company. Current management is expected to stay on. And Sabre had no plans to change SynXis's pricing structure, he said.
Brodows said he does not expect any jobs to be added or subtracted at SynXis, which has about 85 employees, though he added that the situation would become more clear after the companies close the transaction, which is expected early next year.
Shares of Sabre, which operates a leading reservation system for airlines, fell 55 cents yesterday, closing at $22.94.