[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Friday, 4 May 2007, 16:56 GMT 17:56 UK
EU approves holiday firms merger
The internet allows holidaymakers to put together their own trips
A 2.8bn merger of holiday firms MyTravel and Thomas Cook can go ahead, the European Commission (EC) has ruled.

The deal - creating the second biggest travel operator in Europe - would not harm consumers, the EU said.

Internet growth has given independent operators new channels to reach consumers, so a tie-up of High Street names posed fewer concerns, it added.

The merged firm, to be named Thomas Cook Group, will be based in the UK and listed on the London Stock Exchange.

"The increased use of the internet and of online-distribution have opened up a direct route to market for smaller suppliers of package holidays and also allow travel agents and consumers to combine different travel components themselves," the EC ruling said.

It added that the deal would also not harm consumers in the UK and Ireland as they "would continue to have access to package tours at competitive prices".

Declining demand for package holidays has put pressure on the travel industry's traditional earnings streams.

Shares in both firms have rallied since the merger - as well as plans to cut costs and trim jobs - was announced.

The enlarged group said that it would be able to cut 75m a year in costs across its businesses.

MyTravel, formerly known as Airtours, returned to profit for the first time since 2001 in December last year.

How the internet has changed the travel market

MyTravel and Thomas Cook merging
12 Feb 07 |  Business
MyTravel makes return to profit
14 Dec 06 |  Business
MyTravel 'in First Choice talks'
26 Nov 06 |  Business
Weak spending hits Karstadtquelle
09 Aug 06 |  Business
MyTravel recovery as losses cut
15 Jun 06 |  Business
Thomas Cook returns to the black
06 Mar 06 |  Business

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific