Competition chiefs confirm travel agency merger

THE Competition Commission has confirmed that it is waving through the planned high street merger of the travel agency businesses of Thomas Cook, the Co-operative Group (Co-op) and the Midlands Co‑operative Society (Midlands).

A final report confirms the CC’s provisional findings which were published last month. It concludes that the deal “will not result in a substantial lessening of competition in any markets in the UK, in particular for customers buying package holidays from high street travel agents.”

It said that customers are unlikely to suffer from significantly higher prices or reduced choice as a result of the joint venture.

The deal will bring together two of the three largest travel agents on the high street. Thomas Cook currently has 780 stores, the Manchester-based Co-op 360 and Midlands 100. Thomas Cook will continue to conduct its tour operator business separately.

The decision gives a big boost to Thomas Cook, Europe’s second biggest travel firm, which has issued three profit warnings in the last year and sacked its chief executive after losing ground to arch rival TUI Travel, the owner of Thomson and First Choice.

Thomas Cook will own 70% of the combined entity and the mutuals the remaining 30%. The deal will also create the second biggest high street foreign exchange business after the Post Office.

Partners Richard Lee and Richard Thomas from the Manchester office of law firm Addleshaw Goddard advised the Co-operative on the transaction.