It now seems that the well-known tour operator, TUI Travel, is joining up with the Australian adventure travel specialist Intrepid Travel. Apparently TUI is doing this in order to take full advantage of the very lucrative trend for alternative breaks.
Reports show that TUI struck a deal with Intrepid to create a merged company. Overall, it seems like it is a better deal for TUI. In fact, TUI announced that it will control 60 percent of the new company, and Intrepid will control 40 percent.
Now comes the question: Why did these two companies choose to merge together. Well for Intrepid, TUI is a bigger company. Joining up with a bigger company is always a good move. However, what about TUI? According to reports, a spokesman for TUI says that package holidays tend to bring in a profit margin of about 3 to 5 percent. However, an adventure holiday, like those offered by Intrepid, bring in a profit of around 10 percent.
Joining by that fact alone, it would appear that TUI is looking to get into a more profitable business. Overall, this new venture will have revenues of £255 million. It will be comprised of 20 different brands. The chief executive of Intrepid Travel, Darrell Wade, is now going to be the chief executive of the new company which will be called Peak.
Overall, most experts agree that this was a pretty good move. Both companies were already big, but now together they are a giant force. Together these companies can guarantee that they will both be a part of the travel industry for a long time to come.