ZUBIN Karkaria has replaced Peter Meier as CEO of Kuoni Group, the first time in the history of the Swiss company that an Asian has been appointed to the top post but one which comes as little surprise to Kuoni observers who see him as the brainiest of them all in Kuoni of late.
Karkaria founded VFS (Visa Facilitation Service) Global in 2001, a division of Kuoni today that is the fastest growing, most innovative and most profitable. Having sold off its tour operating business, Kuoni now has only two other divisions, GTD, the B2B distribution of hotel accommodation and destination services, and GTS, which provides destination services including accommodation, transport, tours and event management. This division however is wrought with challenges, especially changes in Japanese group travel business, and will be restructured, according to a Kuoni statement.
Kuoni did not however go into detail why Karkaria was appointed CEO and Meier would leave Kuoni. Observers presumed Karkaria knew the business better than Meier and – with a restructuring of GTS, a share price that has fallen drastically and a smaller revenue stream having sold off tour operating – might be able to wave his magic wand to shore up Kuoni in the years ahead.
Kuoni meanwhile is cutting costs with a vengeance to match its smaller size and shareholders’ expectations. GTS’s restructuring would involve a global reduction of 350 full-time posts, expected to shave off the cost base by more than CHF30 million. The group’s support and corporate functions, especially finance and IT infrastructure, would be simplified and outsourced. Even the board of directors is up for shrinking, from seven to six members, with a reduction in the Board’s compensation foreseen.
“The Kuoni Group has been transformed from a broadly based travel company pursuing a wide range of very different activities into a focused global service provider for the professional travel industry and governments. Such an in-depth new strategic direction presents a number of challenges and places heavy demands on management especially in fast-changing markets. After a critical review of the strategic direction, the Board of Directors has decided to accelerate its implementation. The changes in the Executive Board, with Zubin Karkaria as new CEO and Prisca Havranek-Kosicek as new CFO of the Kuoni Group, are part of this process,” said Kuoni Group chairman Heinz Karrer.
The group also announced it has entered into a partnership with HNA Group of China to jointly develop the outbound travel business in China and to partner in related strategic matters.
