Heavily indebted travel company Thomas Cook has announced it is in “advanced discussions” with its largest shareholder, Chinese conglomerate Fosun, over a £750m capital injection and break-up of the firm.   

The new money from Fosun and Thomas Cook’s main lenders would enable world’s oldest package holiday company to continue trading over the coming winter season, as well as invest in the business, Thomas Cook said on Friday. 

A spokesperson for Fosun said: “Fosun is a shareholder in Thomas Cook, because it is a British company operating in the global travel industry, in which we have extensive experience.

“We are committed investors, with a proven track record of turning around iconic brands including ClubMed and Wolverhampton Wanderers FC.”

Under the plan, Fosun would take a controlling stake in Thomas Cook’s tour operating business and a significant minority interest in the company’s struggling airline. A large amount of Thomas Cook’s external bank and bond debt would also be converted into equity, removing much of the debt burden.   

“Looking forward, it is clear that the trends experienced in the first half of the year have continued into the second half, reflecting an uncertain consumer environment particularly in the UK,” Thomas Cook said. 

The company reported a £1.5bn half-year loss in May, noting there was “little doubt” Brexit had prompted customers to put off their holiday plans.

Thomas Cook is in the middle of a cost-cutting drive, closing 21 stores and slashing 320 retail jobs along with a further 150 roles at its Peterborough head office.

READ  Should we be worried by ever more CCTV cameras?

The firm’s stock has tumbled by more than 80 per cent over the past 12 months. The precipitous slide prompted chief executive Peter Funkhauser to tell The Independent in May that customers’ holidays were safe.



Please enter your comment!
Please enter your name here