Less than two weeks after announcing that it had agreed to sell Hotelbeds—its profitable, global bedbank operation—Tui broke the news that it is continuing the process of consolidating its brand identity by selling off its Specialist Group portfolio, which comprises 50 brands. Not included in this sale, said chief executive Fritz Joussen, are Crystal Ski and Thomson Lakes & Mountains, which will be transferred back into the main company, which is headquartered in Hannover, Germany.
The brands in the Specialist Group (it is now known Travelopia) are successful operations, explained Joussen, who added, however, “there is little vertical integration with the core tourism businesses.” In addition, he said, the potential impact on profitability and the large amount of brands are strong strategic arguments not to combine the portfolio under the Tui brand.
The decision to divest itself of the specialist brands is the latest move in a strategic direction announced by the Tui travel group following its merger with its parent company, Tui AG in December 2014. Five months later, the company announced that all of its operations would be brought under a single Tui brand, including its most well-known European companies—the UK’s Thomson and First Choice brands. At the time of the announcement, Tui’s portfolio of brands totaled more than 200.
Also last year, Tui sold its UK hotel booking website, Laterooms and closed its AsiaRooms site. In November, reports began to circulate that Tui was ready to sell Hotelbeds, which it did at the end of last month—for $1.3 billion—to the UK-based private equity firm Cinven and the Canada Pension Plan Investment Board.
But the Tui strategic vision is not entirely about divesting parts of its portfolio. When it announced that it was selling its Specialist Group, it also announced that it had reached an agreement to acquire Transat’s French tour operating company for $61 million as it seeks to increase its French business. According to the German trade publication fvw, “By acquiring fourth-placed Transat, TUI will rise from second to first place with 21 percent of the French market ahead of Fram and Club Med.”