FIRSTChoice is expected to be purchased within the next month to enable the buyer to avoid absorbing the operator’s winter losses.
The tour operator has made an announcement to the City confirming it is considering a number of preliminary approaches. Industry observers believe a deal is likely to happen soon as a purchase now would not absorb any winter losses. “The best time to buy is at the start of the summer season,” said one.
The Association of Independent Tour Operatorshas written to the European Commission urging it to delay its decision – due today – on the proposed tie-up between Thomas Cook and Carlson Leisure Group in light of the latest developments.
Preussag, which will have a controlling interest in Thomas Cook by September, has emerged as the strong favourite. Thomas Cook already has a 10% stake in First Choice. Sources have not ruled out offers from Airtours, which made a hostile bid for FirstChoice, formerly Owners Abroad, in 1993. Kuoni, Bass and Swissair’s parent SAirGroup have also been named as possible bidders.
City analysts said First Choice will be holding out for a price of about 230p a share, valuing the company at about ú800m.