MEDIA giant Flextech is set to sell a 12.5% stake in TVTravel Shop to Kuoni in a deal worth around £7m.
The sale comes less than two months after Flextech sold 38% to Barclays Private Equity for £20m.
The new deal, due to be finalised this week, is a significant move for both companies as it will help TVTravel Shop expand in Europe and give Kuoni guaranteed distribution.
Industry sources said the two parties were still negotiating over certain aspects of its commercial relationship, with Flextech keen to ensure that Kuoni does not compete with TVTravel Shop in Europe. But both companies are determined to conclude the deal.
If it breaks down, Preussag is waiting in the wings to do business with Flextech.
The sale to Kuoni, which has a solid track record and is highly respected throughout Europe, adds further credibility to TVTravel Shop, which has been trading for less than two years but is on target to achieve turnover of over £200m in the year to September 30. TVTravel Shop is already the biggest single distributor for Kuoni’s products.
The deal is also a personal triumph for founders Harry Goodman and Denis Strauss, who retain their combined holding of 12.5% in the television channel.
TVTravel Shop plans to jointly launch with Kuoni into Germany, where it can reach 11m homes, and Scandinavia.
TVTravel Shop will also use the money from the sale to BPEand Kuoni to launch an interactive product in the UK. Flextech resisted approaches by major companies last year, including Airtours, but believes TVTravel Shop can retain its independence through a deal with Kuoni.
Flextech and Kuoni were unavailable for comment.