First Choice, the UK-listed holiday company, has announced that it has acquired online hotel booking website LateRooms for up to £120m.

The company will pay an initial consideration of £108m, followed by a further amount of up to £12m, subject to performance over the next three years. Brothers Steve and Paul Walsh, who founded LateRooms in 1999, currently own 20 per cent of the business and stand to make £24m from the deal.

For the year to 31 December 2005, LateRooms reported EBITDA of £3.7m, and this is forecast to have risen to £6.2m for the year ended 31 December 2006. 

LateRooms offers a price comparison service and a last minute booking facility with an average discount of 40% on full rates. Most of the hotels featured are in the UK, but FirstChoice has stated it now hopes to expand the site to include more European destinations.