Expedia has named group vice-chairman Peter Kern as new chief executive and announced moves to raise $3.2 billion in funds.
Kern has been running Expedia with chairman Barry Diller since the removal of former chief executive Mark Okerstrom in December.
The $3.2 billion in new capital will come via a $1.2 billion investment by private equity firms Apollo Global Management and Silver Lake and $2 billion in new debt.
Apollo Global Management and Silver Lake will each receive a seat on the Expedia board.
The group also announced acting chief financial officer Eric Hart will take the role permanently. Hart took over from former chief financial officer Alan Pickerill, who left alongside Okerstrom.
Expedia said it would seek government aid in countries where it could and announced the furlough of employees and reduced hours of others, initially to the end of August
The group said executive salaries would be cut by 25% and board members be paid nothing for the remainder of the year.
In February, Expedia announced the loss of 3,000 jobs, 12% of its workforce, as Diller pronounced: “We are stopping doing dumb things.”
In a statement yesterday Diller said: “We have one mandate to conserve cash, survive and use this time to reconstruct a stronger enterprise.
“We are unable to make any predictions as to when travel will rebound but emphatically believe that it will.”
The $2 billion in debt will be raised through the issue of ‘senior unsecured notes’ (bonds) and is expected to close on May 5.
In a statement, Expedia said: “These efforts are part of a comprehensive strategy to enhance Expedia Group’s financial flexibility and strengthen its liquidity position.
Kern has been a member of Expedia’s board since 2005 and vice chairman since 2018. He was chief executive of Tribune Media until September 2019 and is a managing partner of private equity firm InterMedia Partners.
Hart has been with Expedia for 11 years and chief strategy officer since November 2019. He previously ran Expedia’s CarRentals.com brand for three years oversaw corporate strategy.
Kern said: “Between the significant steps Expedia Group continues to take to simplify the business and this new funding, we are in better position to rise to the current challenge and come out even stronger. We understand the financial challenges ahead.”
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