Thomas Cook (India) Ltd has signed an agreement to buy Kuoni Group's travel & tour business in India and Hong Kong for Rs 535 crore ($84 million), it said on Friday.
This marks a back-to-back India- related deal for Canadian financial services major Fairfax having sewn a deal to buy majority stake in agri-warehousing firm National Collateral Management Services Ltd and has made an offer to buy a large stake in IIFL Holdings (formerly India Infoline). Fairfax owns majority stake in Thomas Cook.
Thomas Cook said it will operate Kuoni's business in the region independently after bringing on board all of the 1,800 employees of the firm.
Chairman and CEO of Fairfax Holdings Prem Watsa said: "Acquisition of Kuoni's tour operating and retailing businesses in India & Hong Kong as well as the Indian inbound business reaffirms our belief in the India market potential, as also our strategic intent to explore viable geographies, including the larger Asia opportunity."
Kuoni Group CEO Peter Meier said: "With the sale of the tour operating activities in India and Hong Kong, we have completed the sale of the outbound business as announced in January."
Kuoni India managing director Rajeev Wagle said: "While we will continue to operate as two separate companies & brands, a partnership like this - where each partner brings complementary strengths and capabilities to the table - has the potential to create a far more capable, innovative and efficient organisation that can add more value to travellers in the markets we serve."
Fairfax as a group had acquired majority stake in Thomas Cook India three years ago and has been using it as a platform to buy other business services firms. It first routed its acquisition of IKYA Group, earlier a HR services firm, through Thomas Cook and has since rebranded IKYA as Quess Corp Ltd and has struck multiple acquisitions in India and abroad to diversify it into a business support services company. Quess Corp is evaluating an IPO in the near future.
Thomas Cook, which is in the travel & tour business, has also been actively acquiring firms in its own business. It had earlier acquired majority stake in Sterling Holidays and has said it plans to merge it with itself. Recently it acquired a firm in Sri Lanka in the travel business.
Last month, Fairfax has inked a deal to buy 74 per cent stake in National Collateral through its newly created India-focused investment unit for Rs 800 crore ($125 million). This came as back-to-back investment decisions after Fairfax India Holdings Corporation (Fairfax India) made an open offer to buy up to 26 per cent of Carlyle-backed financial services company IIFL Holdings for Rs 1,621 crore ($255.4 million).
Fairfax India raised $1.06 billion early this year through an IPO in Toronto Stock Exchange with anchor investment from Fairfax to invest in India.