Thomas Cook has announced it has signed an agreement with AlixPartners, Thomas Cook UK’s appointed Special Managers, to acquire the rights to the Thomas Cook brand in India, Sri Lanka and Mauritius for a one-time payment of GBP 1.5 Million (approximately Rs. 139 Million). TCIL was previously contracted to pay an annual brand licence fee of Rs. 20 Million to TCUK until 2024 for usage of the brand. Thomas Cook (India) has operated the Thomas Cook brand name uninterrupted in India since 1881. In 2012 when TCIL was acquired by Fairfax Financial Holdings of Canada, TCIL had entered into a Brand Licence Agreement with Thomas Cook Group UK for exclusive use of the brand name until 2024 across India, Sri Lanka and Mauritius. The brand license agreement also gave TCIL the right of first refusal to acquire the brand in the event of the Thomas Cook UK Group going into liquidation before 2024.
TCIL’s acquisition of the exclusive ownership of the Thomas Cook brand in these markets means:
- TCIL can now use the iconic travel services brand name that they have operated for 138 years in India that enjoys high recall and strong brand equity.
- The agreement ensures brand use rights in perpetuity and means that TCIL can use the brand in perpetuity on a royalty-free basis
- This move by TCIL also prevents possible new entrants into these markets, using the brand name
In addition to Thomas Cook, the Thomas Cook India Group operates leading B2C and B2B travel brands including SOTC, TCI, SITA, Asian Trails, Allied T Pro (ATP), Australian Tours Management (ATM), Desert Adventures, Luxe Asia, Kuoni Hong Kong, TC Travel, Private Safaris East & South Africa, Sterling Holidays and Digiphoto Entertainment Imaging (DEI), with strategic investments in Ithaka by Travel Junkie Solutions.
Following Thomas Cook UK’s sale of its entire stake in Thomas Cook India to Fairfax Financial Holdings in 2012, the Thomas Cook India Group has embarked on a significant growth and expansion strategy. Today, the Thomas Cook India Group, is one of the largest travel service provider networks headquartered in the Asia-Pacific region – spanning 29 countries and 5 continents, a team of over 9700 and a combined revenue in excess of Rs. 6718.7 Cr. (over $ 0.96 Bn.) for the financial year ended March 31, 2019.
The Thomas Cook India Group continues to remain financially strong with cash and bank deposits balances of Rs. 10,883 Mn. as of September 30, 2019. On a standalone basis Thomas Cook India is debt free. The Group generates an average annual free cash flow of around Rs. 2,000 Mn.
Madhavan Menon, Chairman & Managing Director, Thomas Cook (India) Ltd, said, “I am delighted that we have been able to sign an agreement to acquire the rights to the iconic Thomas Cook brand across India, Mauritius & Sri Lanka. The brand is one of the most respected names in the travel services space and one that we at Thomas Cook India have operated uninterrupted for 138 years since 1881.
In 2012 when TCIL were acquired by Fairfax Financial Holdings of Canada, we had entered into a Brand Licence Agreement with the erstwhile Thomas Cook Group of the UK to give us exclusive use of the brand until 2024 across India, Sri Lanka and Mauritius for an annual licence fee of Rs. 20 Mn. So when this very attractive investment opportunity of complete ownership of the brand name across these markets, for a one-time payment of Rs. 139 Million came up, it truly was an opportunity we had to grab!
Our teams now look forward to continue to build on the glorious heritage of Thomas Cook across India, Sri Lanka and Mauritius – to grow sustainable value for all our stakeholders in the years ahead.”