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Thomas Cook's Nordic business lives on after private equity deal

Eliza Haverstock

A trio of investors—including two private equity firms—has teamed up to save

Thomas Cook's Nordic business a month after the British travel company suddenly declared bankruptcy, delisted its shares, ceased operations and stranded more than 150,000 customers.



European buyout firms

Altor Equity Partners and

TDR Capital, along with Norwegian real estate tycoon

Petter

Stordalen's Strawberry Group, are slated to assume ownership of the Ving Group, as the Northern Europe unit is called. The group employs 2,300 people across charter businesses in Sweden, Norway, Denmark and Finland, along with Thomas Cook Airlines Scandinavia.



Strawberry Group and Altor will each buy 40 percent of Ving, while TDR Capital will purchase the remaining 20 percent, though no price was revealed. Following the acquisition, the investors will work to secure approximately 6 billion Swedish kronor (about $618 million) in liquidity and guarantees for the business.



Unlike the larger Thomas Cook Group, which was founded in the 1840s to serve the burgeoning British middle class, Ving has recently proved itself profitable. Some of the Ving units will declare bankruptcy in order to facilitate the redirection of all businesses to a freshly established company created by its new owners, but the company's sale will ensure 400,000 people who have booked upcoming trips will be able to travel without issue.



"[The deal] secures the business and creates a stable foundation for future development," Harald Mix, a partner at Altor, said in a statement.



Altor, based in Stockholm, has raised five funds since its creation in 2003. It has invested in more than 60 middle-market Northern European companies, worth a total of €8.3 billion (about $9.25 billion).



TDR Capital, founded in 2002, manages €8 billion in assets and is headquartered in London. It also focuses on mid-market companies, with a preference for growth-oriented investments.



Strawberry Group maintains 11 companies and invests primarily across the real estate, finance, hospitality and art industries. Stordalen is a Norwegian billionaire who, along with his three children, also owns the region's largest resort chain,

Nordic Choice Hotels. The brand operates 180 luxury hotels across five countries.



The buyout of Thomas Cook's Nordic unit may be one of the more dramatic deals in recent memory, but it fits cleanly into the bigger picture of the region's PE landscape. Nordic dealmakers such as Altor have maintained a relatively consistent slice of the European private equity pie over the past decade. As of September 30, Nordic PE deal value this year totaled about €26 billion, about 11% of overall European deal value, per PitchBook's

3Q 2019 European PE Breakdown. Through the past decade, the Nordic region's deals have largely hovered around that same share of the total.



Thomas Cook Group's failure to adapt its largely brick-and-mortar presence to changing consumer preferences for online booking accelerated the debt-laden company's demise this summer. Then, a planned rescue deal with

Fosun Tourism, the Chinese international tourism group that owns the Club Med brand, fell through in September—ultimately sealing the travel firm's fate.



“This marks a deeply sad day for the company which pioneered package holidays and made travel possible for millions of people around the world," Peter Fankhauser, CEO of Thomas Cook, said in a statement at the time.



As a result of the collapse, the UK launched the largest peacetime repatriation in its history to bring home the stranded passengers, reportedly costing British taxpayers around £100 million (about $150 million).



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