Brussels, 7 January 2011
Mergers: Commission refers Thomas Cook's acquisition of CGL's and Midlands' travel businesses to UK competition authorities
The European Commission has referred, following a request by the United Kingdom's Office of Fair Trading (OFT) under the EU Merger Regulation, the assessment of the proposed acquisition of the travel businesses of Co-operative Group (CGL) and of Midlands Co-operative Society (Midlands) by Thomas Cook to the UK authorities. CGL and Midlands are active in the UK only. After a preliminary investigation, the Commission found that the proposed concentration threatens to give rise to competition concerns in the market for holiday distribution, in particular of package holidays, in the UK. The issue will now be examined by the competent UK competition authorities under national law.
Thomas Cook is active across Europe as a leisure tour operator and a distributor of travel services via its travel agency network. It is one of the two major integrated leisure travel companies in the UK, the other being TUI Travel.
The travel businesses of CGL and Midlands are focused on the retail distribution of holiday products in the UK. While CGL has high street travel agencies across the country, the agencies of Midlands are mainly located in the Midlands regions.
The OFT requested the Commission to refer the notified concentration for review to the UK authorities under Article 9 of the EU Merger Regulation. It is concerned that the transaction threatens to affect significantly competition in the distribution of holidays via retail travel agency outlets in the UK and a number of affected UK regions.
The Commission's preliminary investigation confirmed that the proposed transaction would threaten to affect significantly competition in a distinct market which is at most UK-wide. Moreover, the Commission considers that the UK competition authorities are well placed to investigate the effect of the transaction on the national market or parts of this market. As CGL and Midlands are not active in other member states, any possible competition problems are confined to the UK. The Commission has therefore decided to refer the case in its entirety to the UK competition authorities for review.
The transaction was notified to the Commission on 9 November 2010. The OFT referral request was submitted on 2 December 2010. More information on the case is available at: