American Express to acquire Tock for $400 mn, expanding presence in dining industry

American Express (AmEx) is set to purchase the restaurant booking platform Tock from Squarespace for $400 million in cash, a move aimed at enhancing its influence in the dining sector.

American Express digital cards

Last year, the dining category alone generated $100 billion in spending on American Express cards. In Q1 2024, American Express clocked $367 billion in billed business. Revenue increased 11 percent to $15.8 billion. Net income increased to $2.4 billion from $1.8 billion.

This acquisition follows AmEx’s 2019 purchase of Resy, an online restaurant reservation platform. Resy provides AmEx cardholders with exclusive access to certain restaurants, including special reservations, early notifications, and cashback offers on select bookings.

Since the acquisition of Resy in July 2019 through year-end 2023, American Express has increased the number of engaged diners by 3x, increased the number of restaurants by 5.4x and driven solid growth in diners seated.

By acquiring Tock, AmEx will integrate an additional 7,000 restaurants, wineries, and other hospitality businesses into its network. This expansion will enable these establishments to better reach AmEx’s premium customers, known for their significant spending.

American Express has consistently offered substantial perks to justify its higher annual fees compared to competitors. This strategy is central to achieving its growth targets by appealing to affluent consumers and enhancing customer engagement.

AmEx is also acquiring Rooam, a contactless payments platform utilized by restaurants, bars, music venues, and other businesses, for an undisclosed amount.

These acquisitions are expected to bolster AmEx’s efforts in the small and medium enterprise (SME) market, which the company views as lucrative despite a recent deceleration in spending growth within this segment.

Squarespace, which purchased Tock for around $400 million in 2021, is selling the platform for a similar amount, Reuters news report said. This divestment is part of Squarespace’s strategy to streamline its operations as it prepares to be taken private by Permira in a transaction valued at nearly $6.9 billion.

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