EUROPE’S second-largest tour operator Thomas Cook is buying more than half of Russian rival Intourist to enter the growing Russian travel market.
Cook will invest up to $45m (£28.5m) – $10m in cash and $35m in its shares – in the venture for the 50.1 per cent stake.
It said the deal would enable it to cater for strong Russian demand for beach and family holidays, particularly to Turkey and Egypt.
In March, Thomas Cook and Intourist were understood to be discussing a full takeover as an option.
Thomas Cook and its rival, TUI Travel, majority owned by Europe’s top travel agency TUI of Germany, are turning to emerging markets such as Russia and China for growth as they are close to fully realising savings from creating their firms in 2007.
Also, the UK and German tourist markets are seen as relatively mature.
Intourist was founded in 1929 and was the monopoly provider of travel services in the Soviet era. Russia’s oil-to-telecom holding company Sistema acquired the business in 1994.
After a significant restructuring in 2005, it became Russia’s biggest mass-market travel brand, selling breaks to Russian tourists holidaying at home.