Thomas Cook and the Co-operative Group are to merge, resulting in the loss of hundreds of jobs.
The companies announced the deal this morning, effectively creating the largest retail travel network of some 1204 stores and the UK’s second largest foreign exchange business.
The separate branding will remain, however, although 70 outlets of Thomas Cook subsidiary Going Places will be renamed under the Co-operative brand. Thomas Cook’s online operation is not part of the merger.
Speaking on Radio 4’s Today programme, Thomas Cook chief executive Manny Fontenla-Novoa, who will head up the merged company, said that the move followed a tough trading year for the operator troubled by sluggish sales following the ash cloud and the World Cup.
He said “synergies” would be made following the merger – business speak for redundancies – but said these would be “in the hundreds rather than the thousands”.
Last week Thomas Cook launched a cost-cutting programme and it is thought the merger will result in savings of over £35m per year.
"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," said Fontenla-Novoa in a statement.
The new company will be owned 70% by Thomas Cook and 30% by the Co-operative Group.
by Dinah Hatch
