<B> InsideTrack</B>
<B>Amadeus Files IPO</B>
Amadeus Global Travel Distribution last month said it has filed documentation in Madrid for a potential initial public offering. The GDS is expected to sell 25 percent of its equity to the public, with half the shares coming from the anticipated divestiture by Continental Airlines of its 12.5 percent stake. The balance will be offered by the other three shareholders: Air France, Iberia and Lufthansa, with each reducing its holdings from 29.4 percent to 25 percent. Spokesman Miguel Vermehren said Amadeus will use the capital to consolidate ownership of its national marketing companies and continue improving the interaction between the aging host system and Internet-based front ends. It also intends to expand its e-commerce activities, especially its targeting of corporate clients.
<A NAME="2"><B>Hilton And Promus Renew Romance</B>
After a year of talks, insiders said, Hilton Hotels Corp. leads "a number of companies" bidding to acquire Promus Hotel Corp. for "significantly more" than its current $2.4 million market capitalization. "Hilton first talked to Promus when it merged with Doubletree, but the price was too high," said one insider. "Then Promus went through a difficult time with its leadership. When Kelleher and Schultz couldn't reconcile their differing strategies on acquisitions versus internal growth, they both resigned. But its brands, like Embassy Suites and Hampton Inns, have huge brand awareness and loyal customers. The stock is down from $49 to $29--it really is undervalued only because its leadership was an issue--so now's the time for Hilton to do the deal." Bjorn Hanson, hospitality and leisure industry leader at PricewaterhouseCoopers in New York, said Promus's "real strength is some of the best-performing brands in the industry and one of the best franchise distribution networks." Franchising would be a new business model for Hilton, allowing it to grow with less risk as the hotel market softens.
<A NAME="3"><B>Amex Enters Hong Kong Joint Venture</B>
American Express last week announced a joint venture with Farrington Travel of Hong Kong completed at the end of July. Farrington American Express Travel Services Limited begins operating in October. An American Express spokesperson said the deal creates the largest corporate travel agency in Hong Kong. The 50-50 partnership, led by Marie Ninson Loh, Farrington's managing director, will be based at Farrington's Hong Kong offices.
<A NAME="4"><B>New Airline Alliance Ties</B>
Finnair and Iberia last week officially joined the Oneworld alliance, giving the global partnership a trio of European carriers. Japan Airlines still has not made the anticipated commitment to Oneworld, but LanChile expects to join next year. Meanwhile, the Atlantic Excellence partnership continues to break apart. Following Delta's agreement with Air France and the Swissair and Sabena codeshare agreements with American (<I>BTN,</I> July 5), industry speculation has the fourth member, Austrian Airlines, severing its ties with Swissair and heading for the Star Alliance.
<A NAME="5"><B>Canadian Carriers Take Separate Stands On Merger</B>
Canadian Airlines International is supporting a proposal by Toronto-based Onex Corp. to merge the airline with rival Air Canada. The proposition stems from the Canadian government's temporary suspension of the Competition Act, allowing the two carriers and other interested parties to discuss sensitive issues in an effort to aid financially stricken CAI. The deal would pull the merged Air Canada from the Star Alliance and into Oneworld. Air Canada is defending itself from the hostile bid, which includes financial backing from American Airlines parent AMR Corp., approving a shareholder rights plan that entitles owners to buy more shares. A special shareholders meeting has been set for Jan. 7, 2000.
<A NAME="6"><B>Pioneer Corporates Populate BTN's Travel Tech World</B>
Business travel, purchasing and technology executives who have implemented booking, reporting and expense processing systems will compare experiences at next month's Travel Technology World, at the Chicago Hilton & Towers Oct. 12-13. Experiences with expense reporting will be related by executives from Eli Lilly, International Home Foods, Miller Brewing and Owens Corning, booking by buyers from Citibank, PricewaterhouseCoopers, Thomson Consumer Electronics and United Technologies Corp. and decision support by managers from NCR, Phillips Petroleum, Seagram and Siemens. The event also will feature face-offs involving more than 20 vendors and sessions on direct connections, enterprise computing, future of the CRS, corporate intranet travel page content and how to buy and outsource technology, and implement it in Europe. To register, call Maureen O'Connell at 800-950-1314 or visit our Web site at www.travelshows.com.