Read Stock Insights by ET for a quick analysis
TCIL was previously contracted to pay an annual brand licence fee of Rs 2 crore to Thomas Cook UK until 2024 for usage of the brand. The brand license agreement also gave TCIL the right of first refusal to acquire the brand in the event of the Thomas Cook UK Group going into liquidation before 2024. TCIL said agreement ensures brand use rights in perpetuity and means that TCIL can use the brand in perpetuity on a royalty-free basis.
TCIL has operated the Thomas Cook brand name in India since 1881. In 2012, when TCIL was acquired by Fairfax Financial Holdings of Canada, TCIL had entered into a brand licence agreement with Thomas Cook Group UK for exclusive use of the brand name until 2024 across India, Sri Lanka and Mauritius.
In September, Thomas Cook UK declared bankruptcy and said there was no other option but to proceed towards compulsory liquidation of its assets.
Thomas Cook India had subsequently clarified that the developments would not impact it as it was a completely separate entity from Thomas Cook UK after its acquisition in 2012 by Canada-based Fairfax Financial Holdings.
TCIL said the move also prevents possible new entrants into these markets, using the brand name.
In addition to Thomas Cook, the Thomas Cook India Group operates leading B2C and B2B travel brands including SOTC, TCI, SITA, Asian Trails, Allied T Pro (ATP), Australian Tours Management (ATM), Desert Adventures, Luxe Asia, Kuoni Hong Kong, TC Travel, Private Safaris East & South Africa, Sterling Holidays and Digiphoto Entertainment Imaging (DEI), with strategic investments in Ithaka by Travel Junkie Solutions.
TCIL said it has combined revenues in excess of Rs 6718.7 crore for the financial year ended March 31, 2019.
“I am delighted that we have been able to sign an agreement to acquire the rights to the iconic Thomas Cook brand across India, Mauritius and Sri Lanka. The brand is one of the most respected names in the travel services space and one that we at Thomas Cook India have operated uninterrupted for 138 years since 1881...So when this very attractive investment opportunity of complete ownership of the brand name across these markets, for a one-time payment of Rs. 139 Million came up, it truly was an opportunity we had to grab," said Madhavan Menon, chairman and managing director, TCIL.
Download The Economic Times News App to get Daily Market Updates & Live Business News.
1 Comment on this Story
Niketan Agarwal376 days ago
Relief for all the investors who are investing in Thomas Cook India. It is also showing some positive movement from the last few weeks.