about 600,000 Thomas Cook customers are currently on holidays ( Archived) (6)

September 23, 20193:00pm


The CEO of British travel firm Thomas Cook said it was a “deeply sad day” and apologised “to millions” after the cash-strapped travel company went into compulsory liquidation, leaving 600,000 holiday-makers stranded worldwide.

The UK Civil Aviation Authority has confirmed the tour operator, one of the oldest and largest in the world, had “ceased trading with immediate effect” after last-minute negotiations failed to save it.

There are about 600,000 Thomas Cook customers currently on holidays, including 150,000 from the UK.

Thomas Cook, which at 179 years old is one of the world’s oldest travel providers, runs airlines, cruises, hotels, resorts and travel packages for 19 million customers a year in 16 countries. It also employs about 22,000 staff worldwide.

Its recent financial strife has been attributed to tough online competition, the high price of jet fuel and concerns over Brexit.

Chinese firm Fosun had agreed to backing a $1.6 billion refinancing but Thomas Cook’s banks ordered it to cough up an extra $368 million as a contingency to see it through winter. It was unable to secure the extra funds before a deadline today.

In a statement, Thomas Cook said the company’s board “concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect”.

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Thomas Cook Group plc has been in financial difficulty for some time.
BBC reports a group of financiers including Lloyds and Royal Bank of Scotland have given Thomas Cook just days to secure £200 million in emergency funding or it may be forced to cease operations, which could result in the largest peacetime repatriation in British history, with 150,000 travellers potentially stranded

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On 22 September 2019, a last ditch attempt to save the Thomas Cook Group failed to pass. Fosun refused to add another £200 million to a £900 million loan. It was confirmed that the UK government were unable to assist the group and that Thomas Cook Group fell into administration on 23 September 2019, ceasing operations immediately and leaving 600,000 stranded at their holiday destinations

“Don’t just book it.. Thomas Cook it.. Perhaps not..”

It’s the Autumn equinox… Winter is coming…

The £900m cash injection, which Thomas Cook hopes will be completed in early October, is meant to help the company avoid bankruptcy as it heads into winter, when holiday bookings are at their lowest.

However, the firm warned its new owners may cancel its publicly traded shares and take the company private. It said the deal would also significantly reduce the value of shares held by other investors.

“That would explain why the shares have fallen another 14% on the latest news. Investors are simply trying to cash out and crystalise any value left in their investment before the refinancing, for fear there could be nothing left if they wait.”

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China's Fosun set to save Thomas Cook as key terms agreed



Thomas Cook also said in July that it was working to secure new investment from shareholder Fosun Tourism which would see the Chinese group take control of the business, along with Thomas Cook’s lenders whose debt would be converted into equity.

Earlier this year, Thomas Cook said it was exploring a sale of its airline business, which consists of German carrier Condor and UK, Spanish and Scandinavian operations, but a further profit warning in May left management seeking a more radical solution to save the business.

As well as Club Med, Fosun International also owns English Premier League soccer team Wolverhampton Wanderers FC.

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'WE'RE BEING HELD HOSTAGE'

Meanwhile tourists in Tunisia, who booked their tours with Thomas Cook, have been barricaded inside a resort over fears the travel firm will be unable to pay bills.

As tens of thousands of holiday-makers await news on the company's future, Thomas Cook customers staying at the Les Orangers hotel in Tunisia said they had been locked inside until they paid 6000 Tunisian dinars, about $A3097, to catch their flights home.

"We're being held hostage," British tourist Ryan Farmer told the BBC.

Another British tourist, Chris Rutherford, said the hotel reception "told us we need to pay £4000 ($A7372) to be allowed to leave".