Sponsored by
Germans take over MyTravel
KarstadtQuelle will have 52pc of merged holidays company
Eric Barkas City Editor
THERE'S no chance of getting your towel on the sunbed before the Germans.
The British tour operator MyTravel was bought yesterday by Thomas Cook, which is owned by the German stores group KarstadtQuelle. The deal enables the enlarged group to rival the UK market leader, Thomson, which is owned by Germany's Tui.
The deal will create a travel company worth around 2.8bn. Thomas Cook is looking for savings of 75m a year from the deal. There are certain to be job losses in the UK as it takes effect.
MyTravel has almost 13,000 employees worldwide, Thomas Cook has nearly 20,000. In the UK, the companies have a total of 18,781 staff and 1,030 shops.
Peter McHugh, MyTravel's chief executive, said it would take up to 30 months to achieve targeted savings but acknowledged the bulk of job losses would be in the UK as the new company closed high street stores and eliminated duplication in administrative roles.
Thomas Cook chief Manny Fontenla-Novoa said: "The major focus of job losses will be in the UK." But he declined to elaborate.
The deal is the latest in the hard-pressed package holiday industry. Companies have suffered as holidaymakers have taken to putting together their own packages using the Internet and low-cost airlines.
Companies have tried to counter this by branching out into growing leisure markets like cruises and by seeking cost savings. If you get the terms right, merger or acquisition can be the best way to cut costs.
MyTravel, which was formerly known as Airtours, made an ill-judged dash for market share and came close to collapsing under the weight of its debts in 2003 when leisure markets turned down.
The company, which runs the Going Places travel agents, tried to stay independent by closing shops and reducing the number of holidays it sells. It made taxable profits of 43.8m in the financial year ending October 31.
Thomas Cook, best known for its Club 18-30 and Sunset packages, became wholly-owned by KarstadtQuelle when the stores group paid 800m euros to Deutsche Lufthansa for the half of the business it did not already own.
It returned to profit last year for the first time in four years after it slashed jobs and costs.
Mr McHugh said the new company would have total annual revenue of around 15.58bn euros, closing the gap on Thomson's owner Tui which has revenue of some 23bn euros.
The company will be 52 per cent owned by KarstadtQuelle and 48 per cent by MyTravel shareholders. It will be called Thomas Cook Group, be listed on the London stock market and, on current figures, take some 19m people on holiday each year, 6.5m from the UK.
Thomas Middelhoff, KarstadtQuelle's chairman and chief executive, will chair the company. MyTravel chairman Michael Beckett will be his deputy.
Thomas Cook carried 2.8m, or 10.5 per cent, of UK holidaymakers last year. MyTravel carried 1.8m, or 6.6 per cent.
Tui's Thomson carried 4.7m people, giving it a 17.6 per cent market share of the country's 26.7m holidaymakers.
Yesterday's deal is bad news for First Choice, which had been earmarked as a merger partner for both Thomson and MyTravel. It carried 2.5m people, or 9.5 per cent of the market last year, but is now left looking like a poor relation.
eric.barkas@ypn.co.uk
Business Referendum
Is the traditional package holiday doomed?
If you AGREE call 0901 801 4398
If you DISAGREE call 0901 801 4399
Or text your vote YPBUSINESS (space) YES or NO and send to 84070
Or join the debate on our website at www.yorkshireposttoday.co.uk
Views posted on our website must include an address of the sender.
SATURDAY'S RESULT
Should Chancellor Gordon Brown abolish the tax advantages enjoyed by venture capitalists?
Yes 28%
No 72%
Calls cost 10p. Mobiles and payphones may vary. Texts cost 25p plus standard network rates.
Email to a friend
Print this page- Three-inch blanket of snow heading our way today
- Alan Shearer in list of favourites for Leeds and England jobs: Latest odds
- Barnsley’s Keith Hill invokes Fawlty Towers over link with Leeds job
- McCormack feels United search can be narrowed down
- Redfearn throws down gauntlet as queue builds at Elland Road
- Rival chips in with £500,000 to restore the original Harry Ramsden’s
- Visit from Princess as Serbian culture celebrated
- SportsTalk: Leeds United’s manager search, Super League and Calcutta Cup
- Libraries aren’t like supermarkets, they are magical places where dreams begin
- Strategic review will lead to job losses at Yorkshire Bank
Looking for...
Featured advertisers
Jobs
Search for a job
Motors
Search for a car
Property
Search for a house
Weather for Yorkshire
Sunday 12 February 2012
Today
Light rain
Temperature: 1 C to 6 C
Wind Speed: 8 mph
Wind direction: North west
Tomorrow
Sunny spells
Temperature: 4 C to 8 C
Wind Speed: 16 mph
Wind direction: West
