THOMAS COOK GROUP PLC

THOMAS COOK GROUP PLC

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Company Overview
Thomas Cook Group Plc. is a British company that, together with its subsidiaries, operates as leisure travel company which is primarily active in the European market. The company, with headquarters located in Peterborough, United Kingdom, was founded in June 2007 from the merger of MyTravel Group Plc and Thomas Cook AG, a Germany-based travel company.
Thomas Cook Group is one of the world’s largest travel services companies. The company has five wholly owned subsidiaries: Thomas Cook UK, Thomas Cook Netherlands, Thomas Cook France, Thomas Cook Belgium, Thomas Cook Destinations and majority holdings in Condor Flugdienst and TC Touristik. As of January 2007, the company had a combined fleet of 97 owned and leased aircraft, more than 3,000 shops (including those operated through franchise arrangements) and operated 46 hotels and other resort properties (either through direct control or via franchise arrangements). The group’s principal brands include Thomas Cook, Airtours, Neckermann, Condor, Ving, Direct Holidays and Sunquest. Its operation is organised into five geographically-based divisions: UK and Ireland- comprising the United Kingdom and Irish tour operations and UK airlines of MyTravel and Thomas Cook; Continental Europe- comprising Thomas Cook’s operations in Germany, Austria, France, Belgium, the Netherlands, Hungary and Poland; Northern Europe- comprising MyTravel’s operations in Sweden, Norway, Denmark and Finland; German Airlines- comprising the Condor Flugdienst and Condor Berlin airlines operated by Thomas Cook in Germany; North America- comprising MyTravel’s operations in Canada and the United States. The company’s strategy is to continue to deliver benefits from existing cost saving and margin improvement plans already adopted by MyTravel and Thomas Cook; to grow revenues in existing and new market segments; and to deliver efficiencies from being part of a larger group.
Business Summary
The Group is an international leisure travel group, created by the merger of MyTravel Group plc and Thomas Cook AG in June 2007.
Description and history
The Group is an international leisure travel group, created by the merger of MyTravel Group plc and Thomas Cook AG in June 2007.

Thomas Cook Group plc is organised into five geographically-based divisions:

– UK & Ireland (comprising the UK and Irish tour operations and UK airlines of MyTravel and Thomas Cook)
– Continental Europe (comprising Thomas Cook’s operations in Germany, Austria, France, Belgium, the Netherlands, Hungary and Poland)
– Northern Europe (comprising MyTravel’s operations in Sweden, Norway, Denmark and Finland)
– German Airlines (comprising the Condor Flugdienst and Condor Berlin airlines operated by Thomas Cook in Germany)
– North America (comprising MyTravel’s operations in Canada and the United States)

The principal brands include Thomas Cook, Airtours, Neckermann, Condor, Ving, Direct Holidays and Sunquest.

The businesses of Thomas Cook Group plc as at 31 January 2007 had a combined fleet of 97 owned and leased aircraft, over 3,000 shops (including those operated through franchise arrangements) and operated (either through direct control or via franchise arrangements) 46 hotels and other resort properties.

History:

On 12 February 2007, the boards of MyTravel and KarstadtQuelle announced the proposed merger of MyTravel and Thomas Cook to create a leading international leisure travel group. The Merger will be effected by Thomas Cook Group plc, a newly-incorporated company, acquiring each of MyTravel and Thomas Cook. Thomas Cook was previously jointly owned by Lufthansa and KarstadtQuelle. Lufthansa’s 50 per cent. interest in Thomas Cook was acquired by KarstadtQuelle on 2 April 2007. Following the Merger, and on a fully diluted basis, TCG will be owned as to 52 per cent. by KarstadtQuelle (directly or indirectly) and as to 48 per cent. by the existing MyTravel Shareholders.

MyTravel is a provider of package holidays, with operations in the UK and Ireland, Northern Europe and North America. MyTravel’s 16 brands in the UK include Airtours, Going Places and Direct Holidays. MyTravel’s Northern European brands, which include Ving, Spies, Tjaereborg and
Sunwing Resort, give it a market-leading position in Northern Europe. MyTravel North America’s main business is tour operating in Canada and its leading brand is Sunquest Vacations. As at 31 January 2007, MyTravel had a fleet of 31 leased aircraft deployed across the markets in which it operates.

Thomas Cook is the second largest European travel group by sales, with leading positions in terms of sales in the UK, Germany and several other Continental European countries. Thomas Cook’s leading brands in the UK are Thomas Cook, JMC and Sunset. Thomas Cook’s leading tour operator brands in Germany, its largest market, are Neckermann, Thomas Cook Reisen and Bucher Last Minute. Other main brands in Continental Europe include Neckermann, Thomas Cook, Vrij Uit and Pegase. Thomas Cook operates a fleet of 66 aircraft under the Condor and Thomas Cook Airlines brands.

The Merger:

The Merger will be effected by means of the acquisition by TCG of each of MyTravel and Thomas Cook, as a result of which TCG will become the holding company of the Enlarged Group.

The acquisition of Thomas Cook will be effected by means of a share exchange pursuant to which KarstadtQuelle and KQ Freizeit, the owners of the entire issued share capital of Thomas Cook, will be issued TCG Shares in consideration for the transfer of the entire issued share capital of Thomas Cook to TCG.

The acquisition of ownership of MyTravel will be effected by means of the Scheme. MyTravel Shares will be cancelled pursuant to the Scheme and, in consideration, MyTravel Shareholders will receive:

for each MyTravel Share one TCG Share

The Board of MyTravel Group plc announced that at the Court Meeting, Extraordinary General Meeting and Annual General Meeting held on 29 May 2007 all the resolutions contained in the relevant notices of meeting were passed by the requisite majorities.

Accordingly, the merger of the Company and Thomas Cook AG to form Thomas Cook Group plc has now been approved by MyTravel shareholders.

The High Court has on 18 June 2007 made an order sanctioning the scheme of arrangement between the Company and the holders of the
Scheme Shares and confirming the reduction of capital relating to the Scheme.

The Scheme and the reduction of capital became effective on 19 June 2007. At that time, the merger between the Company and Thomas Cook AG was completed. Dealings in the ordinary shares of Thomas Cook Group plc commenced on 19 June 2007.

MyTravel history:

The MyTravel business was established in the UK in 1972 under the name Airtours and MyTravel’s shares were first listed on the London Stock Exchange in 1987. MyTravel has played a leading role in the development of package holidays, which are an extremely popular form of leisure travel, bought by almost 20 million people each year in the UK alone.

In 2002 and 2003, MyTravel suffered significant pre-tax losses, principally in its UK business. During the financial period ended 31 October 2004, MyTravel developed and adopted a business plan with the aim of returning the MyTravel Group to sustainable profitability.

In December 2004, as part of its plan to return the MyTravel Group to profitability, MyTravel completed a major restructuring of its balance sheet, which involved, among other things, a conversion into equity of approximately Ј800 million of unsecured debt and facilities of the MyTravel Group.

Over the last three years, MyTravel has focused on its core businesses in the UK, Northern Europe and North America and in the financial year ended 31 October 2006 achieved a pre-tax profit for the first time since 2001.

MyTravel is organised into three geographically-based operating divisions: the UK (comprising MyTravel’s UK and Irish operations); Northern Europe (comprising MyTravel’s operations in Sweden, Norway, Denmark and Finland); and North America (comprising MyTravel’s operations in Canada and the United States).

MyTravel’s 16 brands in the UK include Airtours, Going Places, Direct Holidays, Bridge, Cresta and Tradewinds.

MyTravel Northern Europe is the region’s largest tour operator by volume of sales. MyTravel’s leading brands in Northern Europe include Ving, Spies, Tjaereborg and Sunwing Resort.

MyTravel North America’s main business is tour operating in Canada and its leading brand is Sunquest Vacations. It also has three smaller US businesses.

As at 31 January 2007, MyTravel had a fleet of 31 leased aircraft, which are principally utilised by its charter tour operators in the UK and Northern Europe. MyTravel also has over 500 shops and operates (through direct control or via franchise arrangements) 41 hotels and other resort properties.

Thomas Cook history:

Thomas Cook was established under its current name in 2001 when the UK travel company Thomas Cook Holdings Limited was acquired by C&N Touristic AG. C&N Touristic AG had itself been created in 1997 through a merger when Lufthansa and KarstadtQuelle brought together their respective leisure travel activities, the charter airline Condor and the tour operator Neckermann, into a 50/50 joint venture.

The last three years have been a time of significant change for Thomas Cook. Thomas Cook underwent a programme of restructuring under new management (commencing in 2003 and concluding in 2005) which strengthened the operating performance of all segments. The strategy of the group over recent years has been to cut costs and streamline processes, improve products and brand positioning, move towards a highly
flexible business model with reduced capital commitments and to dispose of non-core assets, among them non-European entities and hotel and agency participations. These actions resulted in Thomas Cook returning to profitability in 2004 and reporting record earnings for the financial years ended 31 October 2005 and 31 October 2006 respectively.

Following the introduction of a new segment structure on 1 May 2006, the business segments of Thomas Cook are Continental Europe (comprising Germany, Austria, Belgium, the Netherlands, France, Hungary and Poland), UK and Ireland, Airlines Germany (which operates under the Condor brand) and Corporates. Corporates comprises central functions as well as the remaining hotel and agency participations. Thomas Cook has leading positions, in terms of sales, in all of the geographic markets in which it operates.

Thomas Cook has 33 tour operating brands, approximately 2,400 travel agencies (owned or franchised), a fleet of 66 owned or leased aircraft and a workforce of 19,775 full-time employees. The main brands include Thomas Cook, Neckermann and Condor. The group has several other brands catering to specialist interests; luxury brands such as Pegase and Latitude, brands in the low-budget or ‘last-minute’ sector, such as Bucher Last Minute and Sunset, and youth and activity brands, such as Club 18-30 and Neilson.

Founded from the merger of MyTravel Group Plc and Thomas Cook AG, a Germany-based travel company

Business Line
Operates as leisure travel company which is primarily active in the European market;
Subsidiary
ACTIVOS TURISTICOS S.A.
Advisor
PRICEWATERHOUSECOOPERS LLP
IPO date
6/19/2007
US SIC Code
4724
Company Address
Brettenham House, 6th Floor
Lancaster Place
City province or state postal code
WC2E 7EN, LONDON
Phone: +44 20 7557 6400
Fax: +44 20 7557 6401
Country address: UNITED KINGDOM
Website url: www.thomascookgroup.com