British travel groups unveil merger
British holiday firm Thomas Cook and the Co-operative announced on Friday a merger of their stores and foreign exchange businesses, to create the nation's biggest high-street travel chain.
The new company will be 70-percent owned by Thomas Cook and 30-percent owned by the Co-operative, and will have more than 1,200 shops across Britain and about 4.3 million customers.
"Thomas Cook and The Co-operative Group will create the UK's largest high-street travel retailer and the second largest provider of retail foreign exchange," the pair said in a statement.
The two groups aim to generate annual cost savings of about 35 million pounds (39 million euros, 55.4 million dollars) in a deal which is expected to complete in December.
"Today's announcement, together with our plans to cut costs and streamline the rest of our UK business, will put us in a much stronger position, should market conditions in the UK remain weak, and will build a firm foundation for the future," said Thomas Book Chief Executive Manny Fontela-Novoa.
"For our shareholders, this transaction will deliver synergies, be earnings accretive and unlock significant value for no initial cash consideration."
Thomas Cook and Co-operative Travel branches will continue to operate under the same brand names, while the deal remains subject to regulatory approval.
© 2010 AFP