Thomas Cook to learn result of EC ruling
Tour operator Thomas Cook is expected to learn whether they have won a damages case against the European Commission (EC) worth £200-£300m.
The case was brought to court after the EC in Brussels wrongly blocked an industry merger. The EC blocked a takeover of First Choice in 1999 by tour operator Airtours. Airtours, renamed MyTravel, became part of the Thomas Cook group in a merger last year.
When the EC blocked the hostile takeover from Airtours for First Choice, the EC’s then competition commissioner, Mario Monti, said the deal would give three operators “collective dominance” over the UK holiday market. The other two were Thomason and Thomas Cook.
In June 2002, MyTravel challenged the ruling and the European Court of Instance unusually overturned the decision, saying it was not based on “cogent evidence” but “vitiated by a series of errors of assessment”.
A year after that overturning MyTravel filed a £518m damages claim, arguing that the EC’s decision had forced them to forgo three years’ lost profits from First Choice and annual synergies running into hundreds of millions of pounds. The claim is being handled by lawyer Slaughter & May, they added that MyTravel had also built up £10m of abortive bid costs.
Thomas Cook expects to hear today if the claim has been upheld by the Court of First Instance.
The EC would almost certainly fight any damages awarded.