Tue, Jun 11, 2019 - Page 10 News List

Thomas Cook surges after talks with China’s Fosun

Bloomberg

Thomas Cook Group PLC shares surged as much as 24 percent after confirming that it received an offer for its tour-operator business from Chinese investor Fosun International Ltd (復星國際).

Hong Kong-listed Fosun, already Thomas Cook’s biggest shareholder, owning about 18 percent, has submitted a preliminary approach and talks are underway, the UK company said in a statement yesterday.

Sky News on Saturday reported that takeover talks were being held.

Thomas Cook, the world’s oldest travel agency, has lately been grappling with dwindling bookings and uncertainty related to the UK’s departure from the EU.

Selling at least part of the operation is crucial to the company’s survival because a new £300 million (US$380.97 million) loan announced last month is conditional on making progress with a disposal.

Fosun’s tourism arm is a division of billionaire Guo Guangchang’s (郭廣昌) drugs-to-insurance conglomerate, which owns the luxury resort brand Club Med.

Buying the travel agency would give the conglomerate control of a business that serves 11 million customers and reported £7.4 billion in revenue last year.

Thomas Cook said there is no certainty of a Fosun offer, but that the board would consider any proposal alongside the company’s “other strategic options.”

A deal would benefit from booming travel demand out of China. Thomas Cook and Fosun in 2016 partnered to cater to the wealthiest 20 percent of Chinese tourists.

The tour operator has also received offers for its Scandinavian arm from private equity company Triton Partners and for its airline unit from Portuguese airline Hi Fly, the Mail on Sunday reported.

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