Shares in Thomas Cook Group (TCG) have been suspended at 3.5p after the holiday company announced that it would go into compulsory liquidation with immediate effect after talks over the weekend to secure final terms on the recapitalisation and reorganisation of the business ultimately failed.
In August Thomas Cook announced that the required £900m for its capital injection would come from Fosun, its largest shareholder, and its core lending banks and noteholders, both putting up £450m in exchange for stakes in the tour operator business and the airline. Although a deal had largely been agreed regarding the terms of the £900m funding, the additional £200m it confirmed on Friday that was needed to get through the winter season “presented a challenge that ultimately proved insurmountable”, according to chief executive Peter Fankhauser.
Some analysts thought that the failure of Thomas Cook would benefit some competitors, as it removed some capacity from a highly competitive industry. Shares in competitor Tui (TUI) were up more than 6 per cent in early trading, while shares in On The Beach (OTB) were up nearly 4 per cent. Budget airline easyJet (EZJ), which operates easyJet Holidays, was up 4 per cent.
