Over the years, Priceline (PCLN) has built a market cap of $70 billion by pulling off gutsy acquisitions. For example, the deals have given the company footholds in valuable markets like Europe and Asia, as well as different segments like car rentals. And of course, the dealmaking has not lost any momentum, as seen with its recent deal for Qlika.
True, it’s a small one, with a price tag ranging between $15 million and $20 million (according to Techcrunch). But it could have a big impact on PCLN.
Qlika is a startup based in Israel and has a mere ten employees. But keep in mind that they all have masters degrees in areas like physics and mathematics.
Qlika is on a cutting-edge category of “micro-location” ad campaigns. For the most part, it’s a better way to manage things for a mobile world. Let’s face it, ad campaigns can have much better impact if they use location data.
According to the company’s website: “Qlika is the only platform that empowers you to manage & optimize millions of micro-campaigns without expanding your existing marketing team.”
In fact, the company says that its technology can double or even quadruple performance, in terms of clicks, leads or profits. If that’s true, the acquisition could be great news for PCLN. The company is one of the world’s largest buyers of online ads, so even a small increase in performance can make a huge difference.
At first, PCLN will test things out on the Thailand-based Agoda platform, which provides hotel booking services. The initial focus will also be with ads on the Google (GOOG) platform.
But if things go well, it will be a no-brainer to roll-out Qlika across various PCLN properties. In other words, the deal looks like yet another smart one for PCLN. The price tag looks reasonable, too, especially in light of the valuations of other mobile ad network companies like Rocket Fuel (FUEL) and MoPub, which was purchased by Twitter (TWTR) for $350 million.
PCLN stock is up an impressive 14% year-to-date, compared to a modest 1% gain for the S&P 500. If the company keeps making smart acquisitions like this, that outperformance should only continue.
Tom Taulli runs the InvestorPlace blog IPO Playbook. He is also the author of High-Profit IPO Strategies, All About Commodities and All About Short Selling. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.
