Skift Take
Many people will be seeing the next chapter in Manny Fontenla-Novoa’s profession closely. Can he restore his track record with this new pan-European travel bureau?
Matthew Parsons, Skift
Manny Fontenla-Novoa, the CEO dislodged by Thomas Cook after three profit cautions and a bank bailout in 2011, is back in the spotlight a decade later on as 2 European travel companies prepare to combine.
Fontenla-Novoa became president of online travel agency Logitravel in 2018, after it bought Magic Rooms, a service he founded in 2014. It now plans to merge with Spanish firm group Viajes El Corte Ingles, producing a new business which aspires to end up being a worldwide player, taking on the likes of TUI.
The deal goes through the approval of Spanish independent competition regulator Comision Nacional de los Mercados y la Competencia, while the name of the new company has yet to be chosen.
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Logitravel has 1,000 staff members, and declares it provides lodging to 4.5 million customers worldwide. Viajes El Corte Ingles was established as business travel agency in 1969 to book business trips for the different departments and business of parent business El Corte Ingles Group.
Manny Fontenla-Novoa spoke at a UK parliamentary inquiry into the collapse of Thomas Cook in 2019. When okayed– which it’s tipped to be– the new entity would have integrated annual sales of $4 billion, based upon 2019 figures. It will utilize 5,000 individuals, and have 500 points of sale around the world. El Corte Ingles will maintain 75 percent control of the group and Logitravel the rest, regional newspaper El Pais reported. It would have a strong presence in Spain, Portugal, France, Germany and Latin America.
The sales figures are some method off from TUI’s pre-pandemic annual revenue of $22.4 billion, however during the pandemic the bundle holiday giant has actually gotten bailouts of a minimum of $6 billion and is slashing 8,000 jobs as part of its cost-cutting program. For the 6 months to March 31, 2021, TUI reported earnings of $868 million compared to $8 billion in the exact same period in 2015.
The brand-new Viajes El Corte Ingles/Logitravel company claims it will “launch without debt and with a solid financial position.”
A New Thomas Cook?
Fontenla-Novoa managed Thomas Cook’s merger with MyTravel in 2007. The travel business continued to broaden, buying up niche brands, and organized an ill-thought out share buyback program, before collapsing in 2019. China’s Fosun Group picked up the pieces a year later.
Fontenla-Novoa will now be accountable for technique and growth of the brand-new company, according to reports. However, he’ll be supervised by Jorge Schoenenberger, who used up the role of CEO of Viajes El Corte Ingles this month. He joins from Deloitte in Spain, where he ran the accountancy firm’s travel, hospitality, leisure and transportation department for 25 years.
Viajes El Corte Ingles did not react to an ask for remark.
“This appears like a consolidation chance to fill the vacuum left by Thomas Cook, along with the repercussions of Brexit and the rebuilding of the travel market after the global pandemic. I want all success to the management team in this brand-new endeavor,” said Karen Simmonds, founder of UK travel agency Travel Matters.
“However it baffles me how some business, in addition to individuals, can transform themselves and it goes undetected. Some people have brief memory spans, and I hope this next endeavor never results in the large earthquake that happened in the not too range past,” she included.
While the new pan-European company will have a leisure focus, it also coves business travel, incentives, conferences and occasions.
“While many see Viajes el Corto Ingles as a leisure representative, you shouldn’t undervalue its popularity in the Iberian markets as a strong travel management company, regularly beating the likes of American Express Global Service Travel and BCD Travel to the punch,” stated Riaan van Schoor, CEO of agentivity.
In 2019, Viajes El Corte Ingles was called finest travel management company at the Iberian Company Travel Association’s Service Travel awards.
However, he added that both organisations may be “too set in their traditional ways” to contemplate something innovative enough in the travel management area to end up being a serious global competitor to the new technology-first platforms emerging today.
“There’s going to be more consolidation as we go forward,” said Mark Smith, head of business advancement at Simplexity Travel. “I believe they’re attempting to plug a hole from where Thomas Cook left. But whether they can burglarize the UK market, I do not know,” he included, keeping in mind the rise of Jet2holidays and easyJet Holidays over recent years.
CORRECTION: This article has actually been updated with additional comment from Karen Simmonds.
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