UK’s tour operators could be the subject of a sweeping round of mergers and acquisitions due to the economic downturn.

Almost 10 percent of UK tour operators could be taken over, according to the latest findings from industry analysts Plimsoll. These companies had over half their value wiped out over the past year, creating an opportunity for those companies with cash and a willingness to invest.

The research rated the UK’s largest 1,000 tour operators and found 93 were ready for such a take-over, based on a scoring system incorporating financial strength, ownership, valuation and future potential.

The report also claims that these companies might well go under in the current downturn.

Plimsoll senior analyst David Pattison said swift and radical cost cutting was need to save these companies and predicted job losses of up to 3,000 over the next 12 to 24 months as they drastically cut overheads to survive.

“Anyone looking to grow their own company through acquisition should be looking for businesses that are currently undervalued yet, with help, can be turned around,” he added.

Plimsoll has identified 486 companies in the industry with cash to spend, which could help the ailing businesses.

The analysis comes just a day after Plimsoll revealed around 70 travel agencies could face similar circumstances.
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