industry

Thomas Cook shares SOAR after travel firm CONFIRMS takeover approach from Fosun


Confirming reports from last week, Thomas Cook said in a statement today it had received a preliminary takeover approach from Fosun for its tour business. Shares in the  178-year-old travel firm shot up by around 20 percent following the news, taking the price to around 19p. Thomas Cook is looking to sell its airline business after recent reporting a half-year loss of £1.46billion for the six months to 31 March. The company was pushed into the red by a £1.1billion writedown of UK package holiday unit MyTravel.

Thomas Cook partly blamed Brexit uncertainty for the disappointment, claiming UK customers have been delaying holiday plans.

The company maintained there is “no certainty that this approach will result in a formal offer”.

Thomas Cook said in a statement: “There can be no certainty that this approach will result in a formal offer.

“However, the board will consider any potential offer alongside the other strategic options that it has, with the aim of maximising value for all its stakeholders.”

Fosun, which owns Club Med and Premier League football side Wolverhampton Wanderers, is Thomas Cook’s biggest shareholder.

The Chinese firm owns an 18 percent stake in the company, and the pair already do business together in China.

A formal bid could come within weeks and, if accepted, would end the 178-year independence of the pioneering holidays outfit. 

Any offer will not include Thomas Cook’s airline arm as the Shanghai-based group is prohibited from buying it under European Union aviation ownership rules. 

Sky News reported back in May that private equity firm Triton has expressed interest in acquiring Thomas Cook’s airline and tour operating assets in northern Europe.

Thomas Cook cost-cutting measures also include plans for the closure of 21 stores, which will result in the loss of 320 jobs.

Over the past two years, it has closed 200 stores. 

Additionally, the travel company is struggling to cope with spiralling debts, which have risen from £40million to £1.3billion in just two years. 



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