The Commission has approved under the EU Merger Regulation the proposed acquisition of First Choice, a UK travel services company, by TUI, parent of the German TUI group, active in tourism and shipping services. The Commission's decision is conditional upon the divestiture by TUI of its Irish business operating under the 'Budget Travel' brand. In light of this commitment, the Commission has concluded that the proposed transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.
The proposed takeover would result in horizontal overlaps, in particular in the supply of package holidays, inter alia in the UK and Ireland. The UK and Irish markets have vertically integrated tour operators (Thomas Cook/MyTravel, TUI and First Choice), a large number of smaller independent tour operators for short-haul holidays and a few medium-size operators like Virgin Holidays and Kuoni for long-haul package holidays.
The Commission found that the proposed transaction as initially notified would raise serious competition concerns in Ireland, where the parties would be by far the leading tour operator for short-haul package holidays, controlling more than 50% of the market, and would have the largest, nationwide network of travel agencies.
To address the Commission's concerns, TUI offered to divest its Irish business, 'Budget Travel'. In view of this commitment, the Commission found that the transaction would no longer raise serious competition doubts in Ireland.