The European and UK travel industry is set to see a major new force enter the market with the potential merger of First Choice and Thomson Holidays .
German travel group TUI, owner of Thomson, is to merge its tourism operations with its UK rivals in a deal that appears designed to contest the recent merger between Thomas Cook and MyTravel .
The new company will be named TUI Travel, and is expected to generate annual revenues of more than £12billion and 27million customers. It will serve more than 200 destinations across the globe, operating in 20 countries, while its headquarters will remain in the UK with its shares listed in London .
TUI Travel will be 51 per cent owned by TUI and 49 per cent by First Choice shareholders.
First Choice chief executive Peter Long said the merger will produce cost savings of £100million a year, which will mostly come from combining back office operations of the two businesses . Around a third of the savings will be achieved through combining the airline services of the two companies .
Mr Long said the new company would be aiming to create a "one stop shopping" facility for travellers through major investment in its online operations.
He said, "The growth of the internet has changed the whole dynamics on the industry. The combination [of TUI and First Choice] will enable us to compete in the new world."
Mr Long, who will be TUI Travel’s new chief executive, added that at this moment in time it is not be possible to put a figure on the number of employees that could lose their jobs .
First Choice currently employs 16,000 people while TUI employs 33,000.
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First Choice and Thomson Holidays to Merge Wed, 21 Mar 2007      Recommended linksYour online travel agentFind a holiday with First Choice Find a holiday with Thompson Holidays Search for hotel accommodation online Low cost travel insurance deals Rise In Adventure Holidays By Mature Travellers 2007 Set For Rise In Holidays By Brits |
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