Preussag books into Cook

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THOMAS COOK last night looked set to become part of Europe's largest holiday group after the German conglomerate Preussag announced plans to buy a majority stake in the UK travel company.

The deal will lead to the formation of a tourism giant with turnover of over pounds 4.6bn a year and more than 1,400 shops serving almost 10 million package travellers a year.

The Hanover-based giant yesterday put an end to months of speculation and announced that it had bought a 24.9 per cent holding in Thomas Cook from its German owner, Westdeutsche Landesbank.

Preussag, which shed its steelmaking business and has transformed itself into an industrial and tourism group, said it would increase its stake to 50.1 per cent by September if the deal received regulatory approval.

Financial details of the acquisition were not disclosed as Thomas Cook, the owner of the Sunworld and Flying Colours tour operators, is not listed on the stock market. However, City analysts said Preussag could have paid up to pounds 280m for the initial stake and was expected to shell out a similar amount to win control of the UK company.

The deal comes two months after Thomas Cook's decision to merge its worldwide business with the UK activities of the US leisure group Carlson.

Sources close to the company yesterday said that Preussag's interest would not scupper the Carlson deal.

They added that at the end of the complex web of transactions, Thomas Cook will be majority-owned by Preussag, with Carlson and WestLB sharing the remaining 49.9 per cent.

The German bank will retain significant influence through its minority holding in the new group and its 33 per cent stake in Preussag.

The new-look Thomas Cook will be headed by John Donaldson, an insider who is due to become chief executive of the UK company in January.