Manny gets the basics out of the way. Why has Thomas Cook merged with MyTravel?
1 - Thomas Cook and MyTravel had gaps in their portfolios.
2 - Complimentary brands. No overlap.
3 – There will be a far greater geographical spread of products.
4 – Debt free balance sheet.
On the 19 June Thomas Cool Group PLC will be born. The new company’s strategy?
1 – Integrate businesses (get 18,000 people in the UK to focus)
2 – Strengthen package business
3 – Grow independent travel segment through tailored products/dynamic packaging
4 – Extend financial services business (e.g. foreign exchange)
5 – Active role in future consolidation (“which will happen”)
“Staff strategy” – the key tenet of any merger – will be announced on June 21, Manny says.
He also refuses to answer any question regarding the staff or what will happen to the headquarters of both companies – Thomas Cook in Peterborough, MyTravel in Rochdale.
Manny goes on to give some background to the merger. Apparently Thomas Cook received an offer for “another company”, which was rejected by shareholders.
Of course most people in the industry expected a deal with First Choice – it clearly didn’t happen. Manny fusses a little by saying how much he likes and respects Peter Long (First Choice) and how they’ve seen one another a few times since the deal fell through.
The reality is that the MyTravel merger happened very quickly. Three weeks, in fact.
“It was done in a hurry. We had to decide quickly. It was a deal we wanted.
They wanted it.”
“I upset Peter [Long] and my son [who works for Scottish Widows, a majority
shareholder]”
Manny insists the deal is not “a takeover”. He might need to work harder on assuring delegates and the industry this is not the case.
He also mounts a firm defence of High Street shops (although he admits some will close as a result of the merger).
“In a VI [vertically integrated] group they are not a problem. You can still run
a very profitable business shops.”
Despite looking distinctly uncomfortable whenever staffing crops up in conversation, Manny does rather well.
And the “TUI” count for the entire session? Two. Unless you count “the other deal”, which was also mentioned twice.
Kevin May, editor, Travolution
6 comments:
Manny said that staff in shops that closed would be offered alternative posts in the organisation if possible. This ia a legal requirement, so has to be done anyway- but surely there will not be enough positions, and the targeted cost savings will not be met without significant staff reduction
I was amazed that Steve Barras' position was discussed openly with him in the audience- amazing- only the travel industry would discuss such a sensitive subject openly at a conference
Steve Endacott's point on tax losses brought forward from Airtours was a good one- this is a significant reason for keeping airtours as a seperate entity- otherwise the Inland Revenue will challenge realising the tax benefit of these losses. However, the Revenue is always apt to change its view on accounting for tax losses, so if they've factored this benefit into the financial plan, this could be a risk
Re Staffing in Shops.
Guys...remember that most multiple shops have a staff turnover of 30-50% per annum so relocating staff into other local branchs is not usually a problem.
For me the most intersting point in Manny's presentation was that he wants to use the Thomas Cook brand to become an a competitor to Expedia in catering for the rapidly growing "independent" traveller sector selling a full range of airlines and accommodation.
Interestinly therefore the biggest job on the team appears to the current TBA on the structure chart.
I just love Traveling.
Etenerif Holidays
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