Divestment will cut big two down to size

Divestment will cut big two down to size

The former chief executive of MyTravel believes further divestment from the big two will create opportunities for smaller investors in the travel industry.

Duncan Wilson, chief executive of Aim-listed Minoan Group, told the first Travel Weekly Business Breakfast that there was a proven track record of travel companies which grew from small bases through a “buy and build” strategy.

And he believes current market conditions and pressures on the biggest firms will create opportunities for companies such as Minoan, which in the past year has built up a portfolio of travel companies in Scotland including King World Travel, John Semple Travel and Stewart Travel.

“I am completely sure Thomas Cook will get through [its current difficulties] but it will be a lot smaller than it is today,” he said. “Part of that will be a divestiture programme that will be imposed by the banks, and we will be interested in some of that activity.”

Richard Prosser, chairman of Audley Travel and CarTrawler and former head of Tui Travel’s specialist division, added: “The big groups will start divesting and that will be the next big movement in the UK industry. We will see a fragmentation over the next two or three years which will reshape the industry.”

As part of its restructuring, Thomas Cook has already identified saving opportunities including the sale and leaseback of aircraft, the disposal of five hotels and the consolidation of its retail estate following its merger with The Co-operative Travel.

Wilson confirmed Minoan had aspirations to extend its portfolio outside its Scottish base, but said there was no deadline for the company’s next acquisition and confirmed he had “walked away” from two deals in recent months because “the cultures didn’t fit”.

Around 100 senior delegates attended the first of what will become regular Business Breakfast events organised by Travel Weekly targeted at readers of the hugely popular daily 9am Business:am news alert.

The first event, hosted at the offices of The Telegraph in London, was sponsored by accountancy firm White Hart Associates.


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