Thomas Cook acquires Kuoni biz in 17 countries

Thomas Cook has acquired destination management business of Kuoni, a move which marks its big foray into the inbound travel segment and gives it a pricing advantage over its competition.

In a notification to the stock exchange on Friday evening, Thomas Cook said it had acquired Kuoni’s global network of destination management specialists (DMS). The acquired business consists of six business units and is spread over 17 countries in Asia and Africa besides Australia and the US. The deal size was not disclosed.

Kuoni is not exiting destination management business completely. It will retain its group travel business that deals with inbound group tours primarily to Europe.

“Our agreement to acquire Kuoni’s global network of destination management specialists in 17 countries provides us a significant expanded global footprint with enhanced presence in The Americas, Middle East, Africa, Asia and Australiaall favoured destinations for tourists and business travellers worldwide. This acquisition is a strong reiteration that the Thomas Cook India Group continues to invest and grow its travel businesses globally with a view to creating strong value for its customers,” Thomas Cook India chairman Madhavan Menon said in a statement.

In August 2015, Thomas Cook India acquired Kuoni group's business in India and Hong Kong for about ~535 crore. In the same month it purchased Luxe Asia, a destination management company in Sri Lanka.

Thomas Cook has a dominant presence in the Indian travel sector and the latest acquisition will widen its footprint and marks its entry in travel B2B segment. Destination management companies organise accommodation, sight seeing, ground transport for tour operators (such as Thomas Cook) in lieu of commission or margin.

The deal would allow Thomas Cook to benefit from inbound travel in various markets such as the US, Australia, Kenya, South Africa and South East Asia. Also, it will get a pricing advantage over rivals when it sources products and inventories for its outbound tours, industry sources said.

In nine months of FY16, Thomas Cook posted a revenue of ~1,417 crore and net profit of ~8 crore on a standalone basis. During the same period, it made a revenue of ~6,528 crore and ~83 crore on a consolidated basis. Consolidated results include performance of Quess and Sterling Holidays.