LONDON: British travel firm Thomas Cook collapsed into bankruptcy on Monday, leaving some 600,000 holidaymakers stranded and sparking the UK’s biggest repatriation since World War II.
The 178-year-old debt-plagued group, which had struggled against fierce online competition for some time and blamed Brexit uncertainty for a recent drop in bookings, failed to secure 200 million pounds (USD 250 million) from private investors and collapsed in the early hours. Monday’s bankruptcy, which followed a lengthy period of chronic financial turmoil after a disastrous 2007 merger deal, left some 600,000 tourists stranded worldwide according to Thomas Cook, while its 22,000 staff are now out of a job. The British government launched emergency plans to bring some 150,000 UK holidaymakers back home from destinations including Bulgaria, Cuba, Turkey and the United States.
Thomas Cook said in a statement that “despite considerable efforts”, it was unable to reach an agreement between the company’s stakeholders and proposed new money providers. “The company’s board has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect,” it added.
The group has also been blighted by enormous costs arising from its disastrous 2007 merger with MyTravel, a deal which left it plagued with huge debt.
The UK government said it had hired planes to fly home British tourists, in a mass repatriation plan codenamed Operation Matterhorn which has begun.
Launching Britain’s “largest repatriation in peacetime history”, Transport Secretary Grant Shapps added that the authorities had hired dozens of charter planes to fly home Thomas Cook customers.
“All customers currently abroad with Thomas Cook who are booked to return to the UK over the next two weeks will be brought home as close as possible to their booked return date,” the government said.
Both a tour operator and an airline, the travel giant’s key destinations were in Southern Europe and the Mediterranean but it offered also holidays in Asia, North Africa and the Caribbean. Chinese peer Fosun, which was already the biggest shareholder in Thomas Cook, had agreed last month to inject 450 million pounds into the business as part of an initial 900 million pounds rescue package. In return, the Hong Kong-listed conglomerate was to acquire a 75 percent stake in Thomas Cook’s tour operating division and 25 percent of its airline unit.
Cabinet maker Thomas Cook created the travel firm in 1841, transporting temperance supporters by train between British cities. It soon began arranging foreign trips, being the first operator to take British travellers on escorted visits to Europe in 1855, followed soon after by destinations further afield. (AFP)
