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The merger was announced at the weekend, but will require the approval of competition regulators.

The merger is likely to mean several redundancies in the companies' marketing departments; First Choice currently employs 40 marketers while Thomson UK has 50. Thomson's marketing is headed by Andrew Rayner; his First Choice counterpart is Tim Williamson.

First Choice chief executive Peter Long has said that the merger would release £100m in pre-tax savings, with two-thirds coming from eliminating job duplication. A spokesman for TUI said there was a 'high possibility of redundancies', but added it was too early to say whether this would include the marketing department.

The ad business is also likely to be reviewed. It is split between Krow, which won Thomson's £15m business in November, and Beattie McGuinness Bungay, which handles First Choice.

The merger unites the number one and number four tour operators in Europe. The combined company will be 51%-owned by TUI and 49%-owned by First Choice shareholders. TUI will contribute about £600m of net financial debt. The group is expected to generate sales of £12bn.

The company, which will be based in the UK, will be chaired by Dr Michael Frenzel, chief executive at TUI, and managed by Long.

The deal comes just weeks after the announcement of the £3bn merger of Europe's second- and third-biggest travel operators, Thomas Cook and MyTravel.