"It is business as usual at Kuoni," stated Rajeev Wagle, managing director, Kuoni- India, in an exclusive with Financial Express Online
“It is business as usual at Kuoni,” stated Rajeev Wagle, managing director, Kuoni- India, in an exclusive with Financial Express Online. The recent announcement by the Kuoni headquarters (Kuoni’s board of directors and group executive board) based in Zurich to exit from its tour operating activities created a stir in the industry. The company has taken a decision to part with its B2C businesses and focus completely on the B2B and B2G business units namely Global Travel Distribution (GTD), Global Travel Services (GTS) and VFS Global. These core businesses already represent around 60 per cent of Kuoni’s current consolidated turnover. “The decision taken by the headquarters was clearly strategic to accelerate growth and profitability and take the other core business performing units to the next level of growth. M&As, ownership changes are a part of any form of business across sectors, the travel space being no exception,” mentioned Wagle, adding that the headquarters, based in Zurich, will start the formal process of seeking bids and tenders in the coming months. Buyers could be private equity investors, strategic investors or others. Apart from India, Kuoni will also exit from tour operating business in few other regions as well. Whether these business units will be hived off as a whole or in parts will again rest only with the headquarters, informed Wagle. He also emphasised, “The team in India, including all our franchise units are functioning with the same enthusiasm and focus. For us, it is work as usual.”
The company aims to further drive growth and profitability by leveraging the group’s scale, exploiting cross-selling opportunities and developing more new business. In particular, Kuoni will focus on markets with attractive, long-term growth potential such as Asia, the Middle East and Africa. The travel market environment is likely to remain fast- changing, requiring travel companies to choose distinct development priorities. Kuoni has therefore decided to focus its resources and to divest its tour operating activities. On a pro- forma basis, the new Kuoni Group employs approximately 8000 people and generated a turnover of CHF 3.4 billion in 2014. Post-divestment, Kuoni Group aspires to become a leading service provider to the global travel industry and to grow significantly faster than the travel market as a whole.