LONDON (Reuters) - British travel group Thomas Cook (TCG.L) said it had decided not to sell its French business and would instead kick off a restructuring program to turn the under-performing unit around.
The world’s oldest travel group on Monday said following a review into its French unit it would retain the business and “implement a specific transformation program for France to improve performance.”
Shares in Thomas Cook, which have risen 83 percent so far this year, were down 4 percent at 84.25 pence, valuing the group at around 800 million pounds.
The French business, which includes the Aquatour, Jet tours and Kuoni tour operators, has been hit by domestic economic uncertainty and political unrest affecting popular French-speaking destinations such as Morocco and Tunisia.
The 172-year-old group had also struggled over the last two years with a slump in sales leading to a string of profit warnings, forcing it to renegotiate bank loans and make disposals to cut debt.
Since travel industry outsider Harriet Green took over as CEO last May, the company has seen a steady improvement in its finances following a series of disposals to slash its debt, including the sale of its Indian business and several Spanish hotels.
Thomas Cook said its French unit would now come under the direct responsibility of its Continental European segment led by managing director Reto Wilhelm who will take responsibility for the French business from April 1.
Thomas Cook has around 1500 employees in France and 520 travel agencies.
Reporting by Rhys Jones; editing by Kate Holton