Photo/Shetuwang

June 12 (NBD) -- Fosun International Ltd's tourism unit is working with JPMorgan Chase & Co. to buy Thomas Cook Group Plc's tour-operating business, but no final conclusion has yet been reached, according to media reports.

Thomas Cook is the oldest package holiday firms in the UK and owns a vast distribution network in Europe. 

National Business Daily noticed that Fosun Tourism is already the British travel group's biggest shareholder with an 18 percent stake. The Hong Kong-based tourism company first invested in Thomas Cook in 2015. The two companies run a joint venture, majority owned by Fosun Tourism, which targets the increasing popularity of travel among Chinese consumers, particularly to Europe, as well as inbound tourism to China.

Industry insiders held that through the deal in negotiations, Fosun Tourism aims to expand its tour-operating business by leveraging the expertise of Thomas Cook, while the British company hopes to get fresh capital injection to steer its way out of trouble. 

According to the semi-annual report released in mid-May, Thomas Cook, though crowned the world's best-known name in leisure travel, reported operational loss of 1.4 billion pounds (1.8 billion U.S. dollars) and net debts of around 1.2 billion pounds in the half-year period ended March 31, 2019. 

"Although Thomas Cook has an influence in the international tourism industry, it is hard to tell how much the deal (in discussions) will help Fosun Tourism," Wu Liyun, associate professor at China Academy of Culture & Tourism, Beijing International Studies University, said to Beijing Business Today. 

Undeniably, the well-established international player has a mature business model and rich experience, which could be used for reference for Fosun Tourism if the deal is successfully completed, Wu added. 

In Wu's views, the deal would give Fosun Tourism an upper edge if it focuses on developing inbound tourism after the acquisition, but more efforts and more time would be required to grab a bigger share in the outbound tourism market.

Email: lansuying@nbd.com.cn