| Journal: TWUK | Section: |
| Title: | Issue Date: 26/06/00 |
| Author: | Page Number: 2 |
| Copyright: Other |
Operator eyes Italian market after Spanish purchase secures 10,000 beds
Barcelo deal sets First Choice on road to Italian expansion
Report by LIZ BIRD
First Choice is targeting Italy for future expansion after entering into an agreement to buy Spanish travel company Barcelo for £33m.Chief executive Peter Long said there were plenty of opportunities for acquisition in Italy. Two large players, Alpitour and HIT, dominate an otherwise fragmented Italian market. However, he declined to reveal which firm First Choice was interested in.
“We now have a good position in France and Spain but will still look at in-fill acquisitions in those markets,” he added.
The purchase of Barcelo, with which First Choice has had a long-term relationship, will secure access to around 10,000 beds with the option to more than double that number within the next few years.
As part of the deal, First Choice will enter into a joint venture with Barcelo which will provide 15 hotels in mainland Spain and the islands. Long said the bed capacity was “the jewel in the crown” of the deal.
Planning restrictions in Majorca and the whole of the Balearics meant it was crucial to secure access to more beds, he added.
The acquisition of Barcelo provides First Choice with tour operator Turavia; a network of 275 travel agencies in Spain, the Canary Islands and Latin America; and destination services company Barcelo Viajes. First Choice has also taken a strategic 19.37% stake in Spanish-based Globalia Group, owner of Air Europa.
Long said the agencies would assist sales of Royal Caribbean International’s product in Spain while Barcelo’s Caribbean and Mexico operation would aid its UK and Canadian businesses. First Choice recently announced it was taking a 20% stake in Royal Caribbean.
Meanwhile, the group reported increased interim losses from £24m to £32.5m for the six months to April 30, 2000 partly due to expansion of First Choice’s retail network.
Spain: First Choice could double its current bedstock