Chinese shareholder has its eye on larger slice of Thomas Cook

Marco Green
June 11, 2019

The cash-strapped travel firm, which is Wolves' official travel partner, is looking at selling up its tour operator business to the Chinese conglomerate.

Thomas Cook has closed 21 of its stores, its currency arm Thomas Cook Money is under review and the company has said more "cost efficiencies" are planned.

Thomas Cook said in a statement: "There can be no certainty that this approach will result in a formal offer".

However, a company spokesman said: "It's business as usual for all of our customers and staff and we're looking forward to a great summer season".

It was first reported last month that Fosun, which is Thomas Cook's largest shareholder and owner of the Club Med brand as well as Wolverhampton Wonderers football club, was pondering a deal with Thomas Cook.

In an announcement today, the company stated: "Thomas Cook confirms that it is in discussions with Fosun following receipt of a preliminary approach".

Thomas Cook, which issued three profit warnings past year, said it was talking to the Hong Kong-based companyas it suffered dwindling demand for its package holidays and high levels of debt.

Thomas Cook's market value has slumped 83% over the past year following a series of profit warnings.

Earlier this year, Thomas Cook put its airline business up for sale and said it was considering the disposal of its foreign exchange arm.

Ian Forrest, investment research analyst at The Share Centre, commented: "The news is not entirely a surprise as there were rumours of a potential bid last month from Fosun, which already has a significant stake in the company".

However, any deal agreed between the two companies would be complicated by separate interest from private equity firm Triton, wanting to acquire Thomas Cook's airline and tour operating assets in northern Europe - as revealed by Sky News in May.

Shares in Thomas Cook have plunged by more than 80 per cent over the past 12 months.

Other reports by Click Lancashire

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