Expedia to buy rival Orbitz

In a move that further consolidates the travel sector, Expedia is buying rival Orbitz for about $1.6 billion, and comes just a month after Expedia acquired Travelocity for $280 million.

According to a joint statement Thursday, Expedia will pay $12 in cash for each Orbitz share, in the takeover approved by the companies' boards of directors.

Expedia now becomes the largest travel player in the online booking space.

The deal includes the Orbitz online booking site, as well as brands such as CheapTickets, ebookers and HotelClub and CheapTickets.com.

"We are attracted to the Orbitz Worldwide business because of its strong brands and impressive team. This acquisition will allow us to deliver best-in-class experiences to an even wider set of travelers all over the world," said Expedia president and CEO Dara Khosrowshahi in a statement. "From the flagship Orbitz.com brand, to other well-known consumer brands such as CheapTickets, ebookers and HotelClub and the business-to-business brands Orbitz Partner Network and Orbitz for Business, the Orbitz Worldwide team has built a devoted customer base."

Expedia began as a small division within Microsoft in 1996.  It went public in 1999 and has grown into a travel giant with brands including Hotels.com, Hotwire, eLong Inc. and Trivago. In addition to Travelocity, Expedia also bought Australia’s Wotif Holdings Ltd. last year worth $612 million.

The Orbitz move comes amid increased competition in the travel sector from websites such as Priceline-owned Kayak and others, which scan the Internet for the best deals.