Thomas Cook takeover hits last minute hitch

Thomas Cook takeover hits last minute hitch

Thomas Cook has been told it needs to find an extra £200 million in extra funding in order to secure its future.

The troubled operator has hoped to seal a rescue deal led by Fosun Tourism Group this week.

However, lenders are now insisting the cash-strapped travel firm must come up with the new contingency funds.

The money would be used if extra finance is needed to cover costs during the slow winter months

Without the rescue, the firm is likely to collapse.

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Under the terms of the current deal, Fosun has agreed to contribute £450 million of new money to the group.

If agreed, the Chinese conglomerate would acquire 75 per cent of the Thomas Cook airline and up to 25 per cent of the tour operator.

Debtholders and lending banks would inject another £450 million.

Shares in the 178-year-old tour operator have fallen more than 80 per cent since it announced the sale of its airline in February.

The airline is no longer for sale due to the restructuring process.

If Thomas Cook were to collapse it could leave as many as 150,000 holidaymakers stranded overseas.

Many would require the Civil Aviation Authority to repatriate them – potentially costing hundreds of millions of pounds.

The firm employs 22,000 staff, 9,000 of those in the UK.

It serves 19 million customers a year in 16 different countries.

A final vote on that deal was due to take place this week, but it has been delayed until next Friday in the face of the latest demand for extra stand-by funding.

Thomas Cook is one of the largest travel companies in the world.

It was founded in 1841 to operate temperance day trips.

It has annual sales of over £9 billion.

Published at Fri, 20 Sep 2019 05:48:41 +0000