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Expedia announced today that it plans to separate into two publicly-traded companies, one which will operate the more traditional online travel agency and the other which will be focused around the travel review site TripAdvisor.  The Bellevue company’s board has preliminarily approved the spin-off, but the deal still faces a shareholder vote. The transaction is expected to close in the third quarter.

Expedia Inc. will continue to include the domestic and international operations of the company’s “travel transaction brands,” including including, eLong, Hotwire, Egencia, Expedia Affiliate Network, CruiseShipCenters, Venere, Classic Vacations and

The company said that Expedia’s dual-class equity capital structure and the corporate governance arrangements between Barry Diller and Liberty Media will be mirrored at TripAdvisor.

The news is the latest twist in what has been a complex set of corporate transactions involving Expedia, stretching back to its spin-out from Microsoft in 1999.

TripAdvisor, which attracts more than 50 million unique visitors per month, many of whom visit the site to peruse hotel reviews, landed under the Expedia umbrella after it was purchased by Barry Diller’s InterActive Corp. for $210 million in 2004. The unit’s growth has been impressive, with traffic more than doubling in the past three years.

According to Expedia’s most recent annual report, the TripAdvisor Media Network posted $314 million in revenue last year. That was up from $212 million in 2009, and $201 million in 2008. That compares to the company’s so-called leisure segment, which had $2.8 billion last year.

But the leisure business hasn’t been growing as fast, up from just $2.6 billion in 2009 and 2008.

TripAdvisor, which is led by co-founder Stephen Kaufer, is based in Newton, Massachusetts. It has pretty much operated independently from Expedia since the two entities were combined, though Expedia CEO Dara Khosrowshahi told The New York Times in 2008 that they were committed to growing the TripAdvisor unit “as fast as we can.”

The investment from Expedia has paid off both in terms of audience and advertising revenue, and that hasn’t gone unnoticed by some former Expedia execs.

“TripAdvisor, led by founder Stephen Kaufer, is a gem. (A) sizeable one,” former Expedia CEO Rich Barton tells GeekWire. “I’m looking forward to seeing it shine on its own.”

UPDATE: Expedia is not commenting further on the plans to spin-off TripAdvisor, but it did issue statements from Kaufer and Khosrowshahi.

Dara Khosrowshahi, Expedia, Inc.’s CEO and President said: “We are excited about the road forward for our companies: for TripAdvisor to emerge as an independent, dynamic and leading publicly traded media company, and for Expedia, Inc. to continue to return to its roots of technology innovation and speed, and to move forward as a pure play, scale global online travel agency.”

Steve Kaufer co-founder and CEO of TripAdvisor said: “I’m excited to announce the planned spin-off of TripAdvisor and the TripAdvisor Media Group from Expedia, Inc. to become an independent, publicly traded company.  We look forward to this next stage and to our continued growth and innovation in inspiring and helping travelers plan the perfect trip.”

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