Special Report: New Kuoni parent has 'bought into UK vision'

Special Report: New Kuoni parent has 'bought into UK vision'

Kuoni UK ends speculation about its future by securing a German parent. Lee Hayhurst reports

Securing a trade buyer with no UK interests was probably the best outcome for Kuoni, according to the operator’s UK chief.

Derek Jones (pictured), Kuoni’s UK managing director, said the deal – the completion of which is subject to regulatory clearance – removes any uncertainty about the future.

Jones said it was too early to talk in detail about what the sale means for Kuoni’s strategy, but he indicated Rewe had bought into the vision presented by the UK management team.

“They do see the acquisition of the UK part of Kuoni as establishing a UK footprint, which broadens their European distribution business,” he said.

“From that perspective it’s a good fit with everything else they do. We have got to know them reasonably well as part of the sales process.

“We understand their business model and they understand ours, and they had the confidence to take the deal forward.

“What’s interesting, and possibly reassuring, for our trade partners is that there’s no other UK business in the group.

“This is not about directional selling, or integration with a bigger player in the UK market – it’s as you were with the current strategy. We very much see this as an opportunity to accelerate along the road we have been on.”

Kuoni is a very different business in the UK to that which customers in its core market of Switzerland and northern Europe know.

Here it is very much a luxury long-haul tour operating specialist, operating a model much closer to that which it had in Italy, Spain and Russia before it pulled out of those markets.

In recent years it has sought to establish a dedicated retail arm, with implant stores in John Lewis, partner stores with independent agents and its own fully owned store network.

Under Jones it moved to end the distinction between web and high street business by ditching its 5% online discount in 2011.

This underpins its “click and collect” approach, which Jones said supports face-to-face retailing and ensures its agents are not undermined online.

“We have set out our style clearly over the last three to four years in terms of building a business model which is about experts and relationships,” said Jones.

“Increasingly, traditional tour operators find it more difficult to own the product. We have 50 years’ heritage of building great relationships. We realised that the bit we could own was the customer relationship end of it.”

Who is Kuoni's new owner?

Rewe is a major German co-operative, set up in 1927 in Cologne, with significant presence in food retailing, DIY and garden centres.

The firm is pan-European. It employs more than 33,000 people in 12 countries and owns 15,000 stores. It posted a €51 billion turnover in 2014.

Rewe started getting into travel in the 1980s but it wasn’t until 2013 that it placed its travel brands in 
the Der Touristik portfolio.

Der Touristik claims to be Germany’s second-largest tourism group and owns or partners 2,100 agency branches.

The seven brands in Der Touristik are: Dertour, Meier’s Weltreisen, ADAC Reisen, ITS, Jahn Reisen, Tjaereborg and Clevertours.com.

Specialist operator Dertour pulled out of the UK outbound market in 2013, saying the discounting culture made its model unprofitable.


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