Tripadvisor’s Deal: No Outside Suitors, Talks Ongoing With Controlling Shareholder

Tripadvisor is considering “strategic alternatives,” but they aren’t with a third-party suitor. Instead, discussions are ongoing with its controlling shareholder, Liberty Tripadvisor.

Liberty Tripadvisor CEO Greg Maffei told analysts Thursday that talks are “progressing” with Tripadvisor and its special committee, and they “remain focused on the rationalization of our capital structure.”

Tripadvisor had formed a special committee in February to consider a sale or other options.

In a financial filing Wednesday, Liberty Tripadvisor said Tripadvisor had “ceased discussions with third parties.”

Dual Class Stock Structure

Liberty Tripadvisor has an equity interest in Tripadvisor’s common stock and wields a majority of Tripadvisor’s voting power through its ownership of Tripadvisor Class B shares.

It is widely acknowledged that this capital structure and the financial status of Liberty Tripadvisor is a weight on Tripadvisor’s share price. Over the past year, Tripadvisor’s shares traded at a high of $28.56, and were trading Thursday around $16.

Nasdaq delisted Liberty Tripadvisor’s common stock and Series B shares in October 2023.

One issue surely coming up in the Liberty Tripadvisor-Tripadvisor talks is that Liberty Tripadvisor owes Certares $325 million in the form of preferred stock, which was purchased by Certares in March 2020. This investment, which comes with an 8% dividend, would have to be repaid by March 2025.

Liberty Tripadvisor’s financial filing Wednesday stated: “In light of current circumstances, management’s plans do not alleviate the substantial doubt that the entity will continue as a going concern.”