Thomas Cook hit by shock CEO departure, slowing growth

Wed Nov 26, 2014 11:18am EST
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By Sarah Young

LONDON (Reuters) - British holiday company Thomas Cook (TCG.L: Quote) defended its decision to replace Chief Executive Harriet Green on Wednesday after the abrupt departure of the woman credited with reviving the business hammered its shares.

Chief Operating Officer Peter Fankhauser has replaced Green with immediate effect, moving up to the top job after 13 years with the company, the last of them in his current role.

Shares in the world's oldest travel company fell as much as 23 percent on news that the highly regarded Green was leaving plus its warning that growth would slow to "a more moderate pace" in 2015, to reflect a tougher trading environment.

Green joined the company in July 2012 and led a recovery that increased its market value from 148 million pounds ($233.6 million) to just under 2 billion.

Seeking to explain Green's departure, chairman Frank Meysman said the plan had always been to bring in a new CEO once Green had overhauled the firm.

"This was a unanimous decision by the board which included Harriet so it is not a matter of being told, it is a matter of jointly deciding when is the right time," he said.

Meysman conceded that her exit had come faster than either of them had expected. However, Fankhauser had skills more suited to leading the next phase of Thomas Cook's turnaround.

"We feel it is time to move to somebody who has been groomed as a CEO who comes from the industry," he said.   Continued...

File photograph shows Thomas Cook Group plc Group Chief Executive Harriet Green speaking at the CBI annual conference in London November 19, 2012. REUTERS/Suzanne Plunkett/Files