mobanmarketLondon: British travel firm Thomas Cook has failed to find further private investment to stave off collapse and is now relying on an unlikely government bailout, a source close the matter told AFP on Saturday.
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The operator said Friday that it needed 200 million pounds ($250 million; 227 million euros; Dh918 million) – in addition to the £900-million rescue deal secured last month – or else face administration, which could potentially trigger Britain’s largest repatriation since the Second World War.
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A source close to the negotiations told AFP that the company had failed to find the £200 million from private investors and would collapse unless the government intervened.
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But ministers are unlikely to step in due to worries about the pioneering operator’s longer-term viability, the Times reported on Saturday, leaving it on the brink of collapse and stranding up to 150,000 British holiday makers abroad.
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“We will know by tomorrow if agreement is reached,” the source told AFP.
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Two years ago, the collapse of Monarch Airlines prompted the British government to take emergency action to return 110,000 stranded passengers, costing taxpayers some £60 million on hiring planes.
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The government at the time described it as Britain’s “biggest-ever peacetime repatriation”.
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Thousands of workers could also lose their jobs, with the 178-year-old company employing about 22,000 staff worldwide, including 9,000 in Britain.
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Chinese peer Fosun, which was already the biggest shareholder in Thomas Cook, agreed last month to inject £450 million into the business.
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In return, the Hong Kong-listed conglomerate acquired a 75-per cent stake in Thomas Cook’s tour operating division and 25-per cent of its airline unit.
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Creditors and banks agreed to inject another £450 million under the recapitalisation plan announced in August, converting their debt in exchange for a 75-percent stake in the airline and 25 percent of the tour operating unit.
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Thomas Cook in May revealed that first-half losses widened on a major write-down, caused in part by Brexit uncertainty that delayed summer holiday bookings. The group, which has around 600 stores across the UK, has also come under pressure from fierce online competition.
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