Google To Buy ITA for $700 Mn Cash

Google plans to buy ITA Software for $700 million in cash, but conceded that combining its Internet search with ITA’s service, widely used by the travel industry, is sure to draw regulatory scrutiny.

Google’s foray into the business of online travel information allows the Internet advertising and search leader to target users more specifically. But it has unnerved industry players worried that Google could end up wielding too much influence in the sector.

On a conference call on Thursday, Google executives called the deal “pro-competitive” and “pro-consumer” but said it expects that U.S. regulators will examine the deal’s implications closely.

ITA is a major source of information about airfares to the aviation industry, used by a airlines, travel agents and other sites including AMR Corp’s (AMR.N) American Airlines, Continental Airlines (CAL.N), Hotwire, Kayak, Orbitz (OWW.N) and Microsoft Corp’s (MSFT.O) Bing. Google beat out reported bidders Expedia (EXPE.O), Kayak.com and Travelport.

“Their technology opens exciting possibilities for us to create new ways for users to more easily find flight information online, and we’re looking forward to welcoming them to Google,” Chief Executive Officer Eric Schmidt said in a statement.

Google shares, which slid 1.2 percent on Thursday to $439.49 in a weak market, inched up in after-hours trade to $439.89. (Reporting by Alexei Oreskovic and Edwin Chan, editing by Leslie Gevirtz and Carol Bishopric)