The Office of Fair Trading has yet to begin investigating the proposed merger between Thomas Cook, The Co-operative Travel and Midlands Co-operative.
Experts now fear that a serious delay could jeopardise the deal.
Merger plans to create the UK’s biggest travel retail chain of up to 1,300 shops was announced in October. The OFT has the power to refer the deal to the Competition Commission. However, a senior industry executive warned: “A [further] referral could lead people to lose enthusiasm for it.”
The OFT confirmed it would have 45 days to investigate from the day it receives submissions from the companies – although the process can take longer. A spokesman said: “We are waiting for the submissions.”
Travel Weekly understands it will be several weeks before documents are submitted.
The OFT could allow the merger to proceed, request parts of the merged business be sold or refer the deal to the Competition Commission.
The last option would alarm the merger partners as such an investigation can take up to two years. Complicating matters further is a government plan to merge the OFT and Competition Commission.
The OFT has said: “The proposed joint venture threatens significantly to affect competition . . . via retail travel agency outlets.”
Ex-Hoseasons chief excutive Richard Carrick said: “The worst-case scenario is a further referral. I have seen instances where a referral leads people to lose enthusiasm for a merger. Businesses go through a great period of uncertainty, particularly among staff.”
Carrick was a senior executive at Airtours – now part of Thomas Cook – when the company’s bid to take over First Choice in the late 1990s was referred to Brussels and subsequently blocked.