KAHINI CHAKRABORTY – Mumbai
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| Madhavan Menon |
Thomas Cook Group recently following an auction process, sold 77 per cent interest in Thomas Cook India (TCIL) to Fairbridge Capital (Mauritius), a subsidairy of Fairfax Financial Holdings. Under the terms of the agreement, Thomas Cook will receive gross cash proceeds of Rs 8,174 million for its shareholding. The agreed price is equivalent to Rs 50 per share, which represents a premium of 11 per cent to the market price immediately prior to the announcement of the auction process. The Group will grant Fairbridge a licence over the Thomas Cook brand for 12.5 years in the countries in which TCIL currently operates.
Speaking to Express TravelWorld on Fairbridge Capital’s majority stake in Thomas Cook India, Madhavan Menon, managing director, Thomas Cook India, assured that it will be business as usual for customers, partners, employees and the services that the company provides. “Our India management team and I will continue on board and we see no impact on the day-to-day operation of our company. The announcement ushers in a vibrant new chapter in the history of Thomas Cook (India). This is indeed a unique opportunity that my team and I will leverage together.”
This disposal is part of the Group’s previously announced plans to reduce debt and strengthen its financial position, which combined with the proposed sale and leaseback of certain aircraft and sale of HVC will also deliver substantial additional liquidity. The net proceeds of the sale will be used to reduce the net debt of the Group.
Completion of the sale will be conditional upon the approval of the transaction by Thomas Cook shareholders and will require Indian regulatory approval. A circular will be sent to shareholders in due course containing further details of the sale together with a notice convening a meeting of shareholders. The sale of TCIL is expected to complete within the current financial year.
Menon also revealed that he along with the management team have interacted with key representatives of Fairbridge and Fairfax.
“I am delighted that they share our values and are keen on helping us explore all opportunities to expand the company and enhance profitability and shareholder value. The agreement grants us license over the Thomas Cook brand for 12.5 years- till the year 2025; and this is significant,” he added.
He also pointed out that Fairbridge Capital is an investment company engaged in long-term investments and acquisitions in the Indian region with a focus on long-term capital appreciation through a flexible and value-oriented approach, headed by the present chairman and CEO, Prem Watsa.
