Thomas Cook agrees partnership as Chinese Club Med owner takes stake

6th Mar 2015 07:12

Thomas Cook has confirmed that Fosun, the Chinese conglomerate that recently snapped up Club Med, has invested £92m in newly issued shares for a 5% stake in the UK travel group.The FTSE 250-listed company said the pair have formed a strategic partnership to accelerate Thomas Cook's existing growth strategy through a surge into China and closer co-operation with France's Club Med.Fosun will give Thomas Cook better access to the Chinese outbound market, the development of a new hotel concept in the People's Republic, plus exclusive deals with Club Med.The cash proceeds of the investment will be used to be used by Thomas Cook to accelerate strategic investment and reduce leverage, with the company saying its expects the investment to be earnings accretive in 2016, which analysts at Shore Capital suggested at least £10m of additional profit.Fosun said it intended to increase its stake towards 10% with purchases of existing shares in the open market.Thomas Cook chief executive Peter Fankhauser said: "Our partnership with Fosun is aimed at accelerating our profitable growth strategy by allowing us to further develop our differentiated product in our core destination markets, to collaborate with Fosun's other portfolio businesses particularly in France, and to access the world's largest and fastest-growing tourism markets with an experienced local partner."