Financial services firm Tata Capital Ltd said on Monday that it is selling its foreign exchange and travel services subsidiaries to tour operator Thomas Cook (India) Ltd.
The company has signed a definitive agreement to divest its entire holdings into both Tata Capital Forex Ltd and TC Travel and Services Ltd, it said in a statement. However, it did not disclose the financial details.
In 2012, Fairbridge Capital (Mauritius) Ltd had acquired Thomas Cook (India) to become a part of the Prem Watsa-owned Fairfax Group, Canada.
The two Tata companies and its around 300 employees will continue to run under Tata Capital management in consultation with Thomas Cook till the time the share sale is consummated, it added.
“Travel and forex services are growing sectors in the Indian economy. We are confident that Thomas Cook, with its large scale and network, will build these businesses further and help them reach their potential,” said Praveen Kadle, managing director and CEO, Tata Capital.
Madhavan Menon, chairman and managing director, Thomas Cook (India), said that the acquisitions will help the company access a large corporate portfolio, including flagship Tata Group companies.
“The acquisition creates clear opportunities, including a significant increase in scale and network reach, as well as technology gains, all resulting in stronger customer service and stakeholder value,” he added.
In May, Thomas Cook had acquired Kuoni Group’s destination management business to expand its global footprint.
Thomas Cook (India) offers a broad spectrum of services, including foreign exchange, corporate travel, meetings, incentives, conferences and events, leisure travel, insurance, visa and passport services, and e-business. The company set up its first office in India in 1881.
Its current footprint, excluding subsidiaries, spans 261 locations, including 21 airport counters, across 102 cities in India, Mauritius and Sri Lanka. Its net sales had dropped to Rs 392 crore in 2015-16 from Rs 500 crore in the year-ago period. Net profit had also shrunk to Rs 8 crore from Rs 33 crore in the period under consideration.