Yahoo Finance 600,000 stranded: Global travel firm Thomas Cook goes under
Global travel company Thomas Cook has done under, leaving 600,000 tourists around the world stranded.
The 179-year-old company was unable to secure the AU$368 million needed to stay afloat, with 150,000 people from the UK now awaiting repatriation.
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"Thomas Cook Group, including the UK tour operator and airline, has ceased trading with immediate effect," the UK Civil Aviation Authority (CAA) said in a statement.
"All Thomas Cook bookings, including flights and holidays, have now been cancelled."
Richard Moriarty, the CEO of the CAA, said the authority was now engaged in “the UK's largest ever peacetime repatriation".
“We have launched, at very short notice, what is effectively one of the UK's largest airlines, involving a fleet of aircraft secured from around the world. The nature and scale of the operation means that unfortunately some disruption will be inevitable. We ask customers to bear with us as we work around the clock to bring them home.”
We are sorry to announce that Thomas Cook has ceased trading with immediate effect.
This account will not be monitored.
Please visit https://t.co/WWiKkzLYQJ for further advice and information.#ThomasCook pic.twitter.com/Nf1X3jn97x— Thomas Cook (@ThomasCookUK) September 23, 2019
The Transport Secretary Grant Shapps said charter planes had been sent as far as Malaysia to bring travellers home under emergency Operation Matterhorn, with 1 million future travellers set to lose their bookings, although the majority will be covered by insurance.
"I would like to apologise to our millions of customers, and thousands of employees, suppliers and partners who have supported us for many years,” Thomas Cook chief executive Peter Fankhauser said.
“Despite huge uncertainty over recent weeks, our teams continued to put customers first, showing why Thomas Cook is one of the best-loved brands in travel.”
He said Thomas Cook had attempted to secure the funding from creditors and a major shareholder, but was unsuccessful. Chinese firm Fosun had agreed to put up $1.6 billion for refinancing, but Thomas Cook was ordered by its banks to pay an extra $368 million which it was unable to pay.
"Although a deal had been largely agreed, an additional facility requested in the last few days of negotiations presented a challenge that ultimately proved insurmountable," he said.
"It is a matter of profound regret to me and the rest of the board that we were not successful.”
Thomas Cook employs 22,000 people around the world.
Webjet takes $43.7 million hit
Online travel agent Webjet may be forced to write off $43.7 million as Thomas Cook’s liquidation bites.
Webjet today said it thought it would earn between $150 million and 4200 million from Thomas Cook in FY20, and that Thomas Cook had owed Webjet AU$43.7 million.
"The impairment of any unpaid receivables will be treated as a one-off expense to the income statement," Webjet said in a statement to the ASX.
$60,000 weddings ruined
Couples who spent tens of thousands on destination weddings have also been left high and dry.
“We are due to fly out on Thursday,” Leicestershire woman Chloe Hardy told The Sun.
“Our wedding is costing almost £12,000 ($A22,120) with things we have bought here, the wedding package, everything we have organised with the resort wedding coordinator.”
Her destination wedding in Zante, Greece was scheduled for October, with 33 family members’ trips costing another £33,000 ($60,792).
“We are unsure if we will be able to fly. Although, it's ATOL-protected I have booked three weeks' leave from work and there's no guarantee that I will be able to get time off if I had to re-book."
With AAP.
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