$12m buys Harvey control of Thomas Cook in Australasia

By SIMON HENDERY

Two leading players in the travel industry are to merge under Harvey World Travel's Australasian-wide buyout of Thomas Cook.

The deal is likely to lead to most Thomas Cook travel agencies and foreign exchange bureaus getting the Harvey brand.

Job losses within Thomas Cook's New Zealand network, which includes 33 travel agencies, have not been ruled out.

Sydney-based Harvey said yesterday that its $A10 million ($12.3 million) acquisition of Thomas Cook in New Zealand and Australia would almost double its business on this side of the Tasman.

Harvey managing director Paul Fleming said the deal, effective from January 1, would reduce the company's forecast profit for the present financial year and would be partly funded through borrowing.

"We already have visible distribution on the North Island and the merger gives us a more prominent presence in most major towns on the South Island," Mr Fleming said.

Harvey's general manager in New Zealand, Rob Earles, said that while no redundancies were planned at the retail end of the Thomas Cook business, Harvey "would be looking very closely" at the back end of the Thomas Cook operation.

Mr Earles said some Thomas Cook agencies would be retained under company ownership, while others would be franchised out.

Harvey intends to open another 50 foreign exchange bureaus over the next four years and some of these would be in New Zealand, Mr Earles said.

Mr Fleming said the buyout would boost Harvey's e-commerce strategy.

"Our experience is that customers often tend to do their research on the internet but prefer to speak with an agent to make their reservations.

"The addition of the [Thomas Cook] call centre operation provides us with a major enhancement to our e-commerce strategy."

Internationally, Thomas Cook is jointly owned by German tourism company Preussag, Westdeutsche Landesbank, Germany's third largest bank, and US-based Carlson Companies.

Until the 1970s it was owned by Midland Bank.