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. Last Updated: 07/27/2016

Travelocity to Be Largest Travel Site

NEW YORK -- Travelocity, the online travel service, said Monday that it would acquire a smaller rival, Preview Travel, in a deal that will vault it past Microsoft's Expedia to be the largest travel site on the web.

Travelocity is part of the Sabre Group, the reservation system that is controlled by the AMR Corp., American Airlines' parent. Because Preview Travel is a publicly traded company, the deal would allow Sabre to spin off Travelocity as a separate company without the expense of an initial public stock offering.

Other corporations have started to merge their online operations with Internet start-ups to create publicly held units. Sony and Time Warner, for example, merged their Columbia House record club unit with CDNow, an online music store. And Disney is combining its Internet assets with Infoseek, a web search service.

Travelocity and Preview said the deal could close early next year if shareholders and the government approve.