The British travel and airline company Thomas Cook has reached an agreement on new capital injections to save the company from bankruptcy. The Chinese conglomerate Fosun and a group of creditors plan to invest £ 900 million in the company.
Analysts expressed their concerns about Thomas Cook’s financial health earlier this year. The company is suffering from a large debt burden. At the same time, the results of the holiday and travel provider are weakening, which the company blames on uncertainty surrounding the Brexit in the UK. In addition, many Britons stayed home during the holiday season due to persistent summers.
Fosun, which was already a major shareholder in Thomas Cook, crosses the bridge with £ 450 million. In exchange, the Chinese concern acquires a 75 percent interest in the touring division and 25 percent in the airline branch of the holiday company. The group of banks and bondholders convert their credit with Thomas Cook into the remaining shares. In addition, they provide £ 450 million in new capital.
End of listing
Thomas Cook takes into account that the plans will put an end to his listing on the London Stock Exchange, although the company strives to remain listed. Existing shareholders are given the opportunity to participate in the rescue operation. At the same time, they must take into account “substantial dilution” of their pieces as a result of the rescue operation.
The plans have yet to be approved. Thomas Cook expects the deal to be completed in October.