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Last Updated: Friday, 4 May 2007, 16:56 GMT 17:56 UK
EU approves holiday firms merger
Bahamas
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.


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MyTravel makes return to profit
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09 Aug 06 |  Business
MyTravel recovery as losses cut
15 Jun 06 |  Business
Thomas Cook returns to the black
06 Mar 06 |  Business

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