Thomas Cook in talks with Chinese firm over sale of tour operator arm
Cash-strapped travel firm Thomas Cook has confirmed that it is talks with Chinese conglomerate Fosun regarding the potential sale of its tour operator business.
The confirmation follows reports over the weekend that Fosun, Thomas Cook’s largest shareholder, was eyeing up a deal, paving the way for the complete break-up of the British travel company.
Thomas Cook said it is in discussions with Fosun, which also owns the Club Med brand, following a preliminary approach, although there is “no certainty” this will result in a formal offer.
Shares in Thomas Cook jumped by 22% in early trading following news of interest from the Chinese firm, which also owns Wolverhampton Wanderers Football Club.
Thomas Cook has been grappling with a decline in bookings and uncertainty surrounding Brexit, which it said contributed to the £1.5 billion half-year loss it posted last month.
It said the company board will “consider any potential offer” for the tour operator arm, as it looks to maximise value for shareholders.
It is understood that any deal with Fosun would not include Thomas Cook’s airline arm, due to European Union rules.
The travel company has been looking to offload it airline division since the start of this year, confirming a deadline for bids last month.
It also said last month that it had received an offer for its Scandinavian arm from private equity company Triton Partners and was evaluating the offer.
Thomas Cook is slashing costs in the second half of its financial year in the face of tough trading and higher fuel expenses, including axing 150 roles from its head office in Peterborough.
Last month, it also signalled possible further store closures, having already announced plans in March to shut 21 stores and axe 320 retail roles.
Shares in Thomas Cook have plunged by more than 80% over the past 12 months.