THE Kuoni Group has received “quite a lot of interest” for the tour operating businesses it is selling, with CEO Peter Meier confident that these units will be sold by this year and fetch more than their overall net book value.

Kuoni is selling Kuoni Switzerland, UK, Benelux, Scandinavia/Finland, Hong Kong/China and India, estimated to be worth an overall net book value of some 250 million Swiss francs (US$260 million).

In an interview with TTG Asia e-Daily on the sidelines of the WTTC Summit in Madrid, Meier defended the decision to make public the intention to sell as not only appropriate for employees and shareholders, but also to cast the net wider for prospective buyers.

“If you don’t make it public, you automatically limit yourself only to the people you are aware that may be interested,” he said.

“When we announced it, some of the names that came forward were a surprise,” he added.

But Meier would not be drawn into a discussion on prospective buyers, neither denying nor confirming speculation that Germany’s DER Touristik is the latest suitor.

Except for Hotelplan Switzerland, which broke the news to TTG Asia e-Daily that it was interested to buy Kuoni Switzerland and subsequently followed up with Kuoni about it, all others were general expressions of interest, he said.

“We’ve received quite a lot of interest from people who have asked us to send the papers. Since announcing it in January, we’ve put together an eight-page, non-confidential sale memorandum describing the business and we’re sending this out. And that’s the phase we’re at today,” said Meier.

Meier stressed that Kuoni was not selling a sick child; rather, these businesses were profitable and sizeable, with a strong position in their markets. The buyer Kuoni is keen on is a player that can take the business forward.

“The likelihood is high that someone who has a good idea and wants to bring the business forward will also be prepared to pay a good price for it,” he said.

Asked to debunk the biggest misconception about the sale, Meier said: “Some people are always concerned that the whole travel sector has a ‘winner takes it all approach’, that at the end of the day, there can be only Priceline or Expedia, etc. This thinking is fundamentally wrong, because the travel sector is so large.

“All of us are intermediaries – we don’t own hotels or consumers. It’s not a ‘winner takes it all’; there is room for many players and tour operating is hardly negative.”

– Read the full View from the Top, TTG Asia, May 15, 2015

INDIA’S Reality Tours & Travel, which pioneered tours that take visitors to the slums, has found its efforts paying off in more ways than one.

The agency was saluted at WTTC Summit with the 2015 Tourism for Tomorrow Award – Community Category and, from its humble origins, has expanded to offer a range of other gritty tours including local public transportation tours and street food tours in India.

As well, it has added another slum tour in Okhla, a neighbourhood around the old village in South Delhi district, following the success of its first slum tour in Dharavi, Asia’s largest slum in the middle of India’s financial capital, Mumbai.

“The word ‘slum’ is negative. It is associated with poverty, danger, hopeless people. But Dharavi is filled with energy, entrepreneurship, hope and possibilities,” Reality co-founder, Krishna Pujari, told TTG Asia e-Daily. “I grew up in a slum and I made it a point to live in Dharavi for a month before launching the tour there. If it were dangerous, I would not have done it.”

Eighty per cent of Reality’s profits from tours go back to community development projects, which have benefited more than 2,500 locals since 2009. One pay-off is training locals in Dharavi to be teachers; they then teach in a school built by Reality.

According to Pujari, visitors to the Dharavi slum include foreign tourists from all over the world and students from prestigious universities overseas.

He is particularly gratified that today, many of the locals are no longer ashamed to say they are from Dharavi. “Growing up, Dharavi was described in my own geography book as ‘the largest, open, dirty place in Asia’. The image has changed to a place with a strong sense of entrepreneurship and community,” he said.

Winners in the other categories of Tourism for Tomorrow Awards this year are:
Destination: Ljubljana, Slovenia
Environment: Soneva Group, Thailand and Maldives
Innovation: TripAdvisor GreenLeaders, US
People: Confortel Hoteles, Spain

– Read the News Analysis on how winners dare to push the envelope in TTG Asia, May 15, 2015

JAPAN aims to be a model that other mature cities can turn to when hosting an Olympics event, benefiting the destination long after the event has ended.

Japan National Tourism Organization (JNTO) president, Ryoichi Matsuyama, said while Japan’s reason to host the Olympics in Tokyo in 2020 was to attract more visitors, ensuring that tourists would continue to come after the event was more important.

“We’re in the stage of seriously discussing what legacy to leave and it’s not finalised as there are so many stakeholders. One legacy, however, is for the Tokyo Olympics 2020 to be remembered as the most disabled-friendly. Another is how an established, mature city hosts the event sustainably. Normally, hosting the Olympics requires a heavy investment and the host suffers afterwards and is not able to sustain visitor growth.

“We are mindful not to spend too heavily and to ensure that visitors return after the event,” he told TTG Asia e-Daily on the sidelines of the WTTC Summit.

There would only be few new infrastructure projects built just for the Games and even the design of a new stadium, by renowned architect Zaha Hadid, has been scaled back to save costs, he said.

JNTO also recently signed an MOU with VisitBritain, “as London, which successfully hosted the Olympics in 2012, is also a mature city and there is much we can learn from it”, he said.

A Japan-UK tourism symposium – Growth strategy for tourism, making the best use of the Olympic and Paralympic Games – was held in London shortly after the signing.

Matsuyama is confident that there will be enough rooms to cater to the games. JNTO is “presenting facts” to hotel developers about the attractiveness of building more rooms in Tokyo, saying there is a need specifically for more four-star hotels.

Arrivals have continued to climb, reaching 13.4 million last year. Matsuyama expects 2015 to bring around 15 million visitors, acknowledging growth is only being constrained currently by a lack of rooms.

– Read the View from the Top in TTG Asia soon

CHINA’s economy is the next big disruptor to watch, warned Richard Fenning, CEO of New York-based global risk consultancy Control Risks, at WTTC Summit 2015, which kicked off yesterday under the theme of Disruption & Reinvention.

The biggest risk, he said, was the Chinese government’s management of the economy and whether it can successfully oversee the market’s transformation from a reliance on large-scale investment to Chinese consumption and spending on domestic goods and services instead.

Unlike other “containable” geopolitical risks such as the problems in the Middle East and Russia, Fenning warned that an unsuccessful transition in China would derail the economic recovery being seen in the US and Europe, due to the interdependence of the global economy.

But he believes China is going to be successful as it has “the most confident people running the place”.

Travel and tourism companies meanwhile were deemed successful in managing disruptions and were urged to continue reinventing themselves in the face of disarrangements.

The industry has shown that it “thrives on disruption”, said David Scowsill, WTTC president & CEO.

“Observers have prematurely announced the demise of charter airlines, tour operators, leisure travel consultants and global distribution systems – all of which have not only survived but thrived,” Scowsill pointed out.

Doug Anderson, president and CEO of Carlson Wagonlit Travel (CWT), said the two areas that caused the most disruption to his business were the eurozone crisis, which curtailed business travel spending, and socio-politics including terrorism, political crises and health epidemics.

The former, however, boosted the need for travel spend management while the latter sent CWT reinventing safety and security processes for its clients’ travellers on the road.

Gary Chapman, president group services & DNATA, Emirates Group, said the word ‘disruption’ suggested something unusual when it was in reality “nothing of that sort”, rattling off all the crises the industry has had to fend off each year for many years in the recent past.

“Leadership must be resilient and mentally tough,” said Chapman.