Thomas Cook to buy out JV retail partners to take full ownership

6th Dec 2016 07:42

(ShareCast News) - Thomas Cook is to take full ownership of its retail joint venture and buy out its partners in order to consolidate the travel company.The FTSE 250 company will buy The Co-operative's 30% stake in the joint venture for £50m and the Central England Co-operative's 3.5% stake for £5.8m in cash to take full control of the retail business.As part of the deal, which is expected to be completed in November 2017, the company will be able to use the Co-operative Travel brand until November 2018.The joint venture, which was initially created in October 2011 following the merger of the travel retail business of Thomas Cook, The Co-operative and Central England Co-operative, currently has 764 stores across the Thomas Cook and The Co-operative brands.Rod Bulmer, chief executive of consumer services at the Co-operative, said that having a minority stake in a travel business "does not fit with the strategy" of the Co-operative and that the financial arrangements for exit that were put in place as part of the original joint venture agreement represent the best value for its members, while the funds received will be used to invest in its core business areas.Thomas Cook's chief executive Peter Fankhauser added: "This purchase gives us full control over our retail store network, enabling us to better integrate our stores with our online offering, while also helping us to focus on growing sales of added extras such as holiday-related financial services. Over the next two years, we will bring all of our UK stores under the Thomas Cook banner so we can make full use of the best brand in travel."Shares in Thomas Cook were up 1.57% to 87.30p at 0828 GMT.