Expedia Group's stock experienced a significant surge after reports emerged that Uber Technologies has been exploring a potential takeover of the travel-booking giant. The Financial Times reported that Uber has been in discussions with advisors to assess the feasibility of acquiring Expedia, a move that aligns with Uber's ambition to become a 'super app' offering a wide range of services beyond its core ride-hailing and food delivery operations.

The news of the potential acquisition sent Expedia's shares up by as much as 8% in premarket trading, while Uber's stock saw a decline of over 3%. The discussions are reportedly in the early stages, with no formal approach made to Expedia yet. Uber's CEO, Dara Khosrowshahi, who previously led Expedia and remains a non-executive director on its board, could play a pivotal role in facilitating a friendly acquisition.

Expedia, valued at nearly $20 billion, would represent Uber's largest acquisition to date. The travel company, which owns popular brands like Hotels.com and Vrbo, generated close to $13 billion in revenue last year. In contrast, Uber, with a market capitalization of $172 billion, reported $9.9 billion in revenue in 2023.

Analysts have mixed views on the potential merger. Some see it as a strategic move that could enhance Uber's service offerings and improve its margin profile, while others express concerns about the challenges of integrating Expedia's diverse brand portfolio.

The potential acquisition reflects Uber's strategy to diversify and expand its service offerings, similar to its previous acquisitions of Postmates and Transplace. However, the complexity and scale of acquiring a company like Expedia present significant challenges and opportunities for Uber as it seeks to redefine its business model.