Investing.com -- Shares of Sabre Corporation (NASDAQ: SABR ) surged 19% following the announcement of a definitive agreement wherein TPG, a global alternative asset management firm, will acquire Sabre’s Hospitality Solutions business for $1.1 billion in cash.

The transaction, which is set to establish Hospitality Solutions as a standalone entity, is expected to close by the end of the third quarter of 2025, subject to regulatory approvals and customary closing conditions. The sale will enable Sabre to focus more intently on its core airline IT and travel marketplace platforms, aligning with its strategy to optimize its product portfolio and drive long-term shareholder value.

Sabre’s President and CEO, Kurt Ekert, remarked on the divestiture, "The $1.1 billion sale of this business is a testament to the transformation that the Hospitality Solutions team has driven over the past few years." He expressed confidence in TPG’s ability to enhance value for all of Hospitality Solutions’ customers.

The proceeds from the sale, approximately $960 million net of taxes and fees, are primarily earmarked for debt reduction, which will strengthen Sabre’s balance sheet and support its pursuit of long-term sustainable growth. This move follows a series of strategic financial actions by the company, including debt refinancings and repayments, aimed at reinforcing its disciplined capital allocation framework and improving its capital structure.

Hospitality Solutions has grown to serve over 40% of the world’s leading hotel brands with its SaaS-based platform, which acts as an integrated system of record for reservation and guest information. TPG’s investment through its private equity platform is anticipated to bring dedicated resources for growth and expansion to the business, leveraging TPG’s expertise in supporting and growing mission-critical software businesses.

The announcement has been well-received by investors, as evidenced by the significant uptick in Sabre’s stock price. The company’s focus on optimizing its core business areas and enhancing its capital structure appears to resonate with the market’s outlook for Sabre’s future performance.

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