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U.K. travel bid talk revived
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September 6, 1999: 7:00 a.m. ET
First Choice appoints new chief as Airtours circles for possible hostile bid
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LONDON (CNNfn) - Shares in U.K. tour operator First Choice jumped 6 percent Monday amid speculation that rival Airtours may revive a takeover bid dropped earlier this year after regulators expressed competition concerns.
First Choice also benefited from its decision to promote managing director Peter Long to the post of chief executive, a move which analysts believed was intended to avoid the highly-regarded executive being poached.
Airtours had hoped to leapfrog Thomson Travel to become Britain's largest package holiday firm by snapping up First Choice in the midst of a planned merger with Switzerland's Kuoni. However, that deal was overwhelmingly rejected by First Choice shareholders.
Thomson shares have sagged since its IPO last year, a performance which culminated in the departure of its chief executive in July. "The market wants Peter Long to go in as chief executive of Thomson," said one London-based analyst who declined to be named.
Analysts said Long would be unlikely to stay with First Choice if a new Airtours bid succeeds.
The original Airtours bid lapsed after European regulators launched a formal investigation into the impact of the proposed deal on the rapidly consolidating travel market.
The European Commission said Monday that Airtours has until Tuesday to make any further concessions in its attempt to gain regulatory clearance for its bid for First Choice.
Commission officials said Friday that they still had reservations about the deal, which would give Airtours a 35 percent U.K. market share and build on its significant presence in Ireland and Scandinavia.
According to a report in London's Daily Telegraph Monday, Airtours is ready to sell some assets to soothe the regulators, including its in-house Unijet airline, an airline seat broking business and its direct holiday sales arm. Airtours declined to comment.
Antitrust officials at the European Commission in Brussels, the executive arm of the European Union, are due to report on their findings on Sept. 22.
First Choice (FCD) shares jumped 5.7 percent to 188 pence in midday London trade while Airtours (AIR) lost 1.1 percent to 440 pence. Airtours' original all-stock bid for First Choice valued the shares at 220 pence. 
-- from staff and wire reports
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