Holiday firms MyTravel and Thomas Cook have announced they are to merge, pledging to deliver "significant value" to shareholders in the process.
The combined company, to be known as Thomas Cook Group and listed in London, will operate in the UK, Ireland, France, Germany, the Netherlands, Belgium, Canada, Scandinavia and Finland.
According to executives from both MyTravel and Thomas Cook parent company KarstadtQuelle, the merger will generate cost savings of at least £75 million.
MyTravel chairman Michael Beckett explained that he was pleased to have stolen a march on package holiday rival First Choice by teaming up with one of Britain's more iconic brands.
"Thomas Cook is a household name and the joining of the two groups will create an even stronger force in this highly competitive market," he said.
And Thomas Middelhoff, chief executive officer of KarstadtQuelle and chairman of Thomas Cook, added: "The combined organisations will offer customers unrivalled choice and quality for their holiday and leisure time in all of the markets in which we operate."
MyTravel shares were up by more than 25 per cent on early morning trading.
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