Job cuts at Thomas Cook

Source: Stock Market Digital

Date :27/06/2007 11:05:20

Travel agent Thomas Cook has announced that up to 2,800 jobs will be lost as a result of its merger last week with MyTravel.

These plans are a key step in the integration of the former MyTravel and Thomas Cook businesses, which merged on 19 June 2007, contributing to the achievement of synergies of at least £95 million (€140 million).

Under the proposals announced today, the Group’s divisional head office would be in Peterborough, with six UK sites to close.

The retail network is currently being reviewed with a view to reducing the network by 150 stores to around 800 stores. It is proposed that the main retail brand would be Thomas Cook, with the Going Places brand retained in towns that will have more than one store.

The company expects that if the proposals go ahead, an estimated 2,500-2,800 jobs will ultimately be affected.

The integration process is expected to involve the closure of six sites and a number of stores, the Group has stressed to employees that where possible redeployment opportunities will be offered to all affected staff.

Manny Fontenla-Novoa (pictured), Joint Chief Executive, Thomas Cook Group plc said: “Today’s announcement is about a significant UK reorganisation. As many as possible of those whose roles are potentially affected by today’s news will be offered the opportunity for redeployment within the business, as we are absolutely committed to retaining the skills and experience of all our workforce. However, we appreciate that some employees will either not want to take up our offer of redeployment or will not be able to do so. For those employees we will provide appropriate redundancy packages and full support.

“It is only a week since the merger was completed. Our priority has been to communicate integration proposals to our employees as soon as we could. Today we have put in place a comprehensive employee consultation programme to support our people through the integration process. We will do everything we can to support those employees who are affected through the next few months.”

Both companies completed a £2.8 billion merger last week, with Thomas Cook saying cost-savings of £95 million could be achieved as a result.

Between 2,500 and 2,800 employees, 15 per cent of the company's workforce, are to be made redundant as six offices and 150 of its 800 stores face closure. Manny Fontenla-Novoa, joint chief executive of Thomas Cook, said that "as many as possible of those whose roles are potentially affected by today's news will be offered the opportunity for redeployment within the business". He also insisted the firm remained "absolutely committed" to retaining the skills and experiences of the workforce.

"However, we appreciate that some employees will either not want to take up our offer of redeployment or will not be able to do so," he added.

un 27, 2007 04:30 AM

Thomas Cook Group PLC, the European tour operator created by the recent merger between MyTravel Group PLC and Thomas Cook AG, said yesterday it plans to cut as many as 2,800 jobs to meet cost-reduction targets.

Six office and warehousing sites and about 150 travel stores will close, affecting at least 2,500 workers, the Peterborough, England-based company said. That will leave about 800 retail outlets. Most stores will operate under the Thomas Cook brand, with Going Places travel agencies only being kept in towns that have more than one branch.

Travel firms are combining to cut costs as online competitors and discount airlines cut prices. The Thomas Cook merger will save at least $190 million (U.S.) a year.

The job cuts are a "key step" in meeting cost-saving targets, joint chief executive Manny Fontenla-Novoa said.