EU regulator to review Thomas Cook-Cooperative Group deal
08 Jan 2011
The Office of Fair Trading has received the go-ahead from European regulators to review Thomas Cook's proposed deal to merge its travel retail businesses with those of the Co-operative Group.
According to the tour operator's October announcement, the combined group would consist of 1,200 retail shops, with Thomas Cook owning two-thirds of the entity, the Co-op 30 per cent, with the remainder going to Midlands Co-operative.
The deal between the two operators included the partners' foreign exchange and cruise operations, with expected synergies of £35 million a year. Additionally, it included £10 million in "upstream" Thomas Cook operations.
However, the OFT ruled in December that the proposed merger would threaten competition.
The OFT asked for permission from the EU to further investigate the merger, on the grounds that it affected only UK operations. At issue is whether it factored in the wider travel market, which includes the internet, airline bookings and direct sales.
"The European Commission notified Thomas Cook that it has granted this referral request and the OFT will have 45 working days on receipt of a complete notification to investigate. We will continue to work closely with the OFT to obtain a rapid clearance," Thomas Cook said.
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