Thomas Cook Collapse

 

Thomas Cook ceases trading

Thomas Cook aircraft parked up at Manchester Airport after the company stopped trading. Spencer Bennett

Thomas Cook Group entered compulsory liquidation on September 23 and its UK entities ceased trading with immediate effect at 3am that morning, despite several of its aircraft still being airborne. The collapse followed months of uncertainty and numerous attempts to secure funding or sell parts of the company. Efforts to repatriate those stranded by the collapse were ongoing at press time. Under the name Operation Matterhorn, around 106,000 of an estimated 150,000 affected holidaymakers had been repatriated by September 30, with 94% of them able to return on their scheduled date, according to the CAA.

The airlift was being co-ordinated by Titan Airways on the government’s behalf. The Stansted-based wet lease specialist drafted in aircraft from across the world, including from Malaysia and the United States to assist in the airbridge. Over 100 aircraft have been involved, and they are expected to make more than 1,000 flights during the operation.

Thomas Cook’s financial problems had been ongoing for some time. The company reported losses of £65m and debts of £1.25bn in its half-year results for the six months to the end of March, causing its share price to fall as low as 8.4p during May and analysts at Citigroup to describe its shares as “worthless”. A rescue bid came in late August with China’s Fosun Tourism acquiring 75% of the tour business and 25% of its airline in a £450m deal. Thomas Cook’s lending banks and bondholders also contributed a further £450m, receiving three quarters of the airline and the remaining stake in the tour operator.

While this provided a glimmer of hope to the company, the banks demanded it arranged an additional £200m to see it through what they anticipate will be a tough winter for the UK’s travel industry.

While the firm’s British carrier ceased operations immediately, its airlines in Germany, Denmark and Spain have continued almost unaffected as they are independent arms operating under the Thomas Cook umbrella. Thomas Cook Airlines Scandinavia briefly suspended flights on September 23 before resuming its services the following day. Unlike its UK counterpart, Condor – which was not wholly owned by Thomas Cook Group – had its request for a bridging loan approved and the German government allocated €380m (£336m) to ensure the carrier can continue flying.

Thomas Cook Airlines’ last revenue service was flown by A330-200, G-MLJL (c/n 254) – TCX2643, from Orlando/ International to Manchester – touching down at 8.33am. The widebody jet’s arrival at the Northwest hub ended 178 years of the travel brand’s UK operations. Derbyshire cabinet-maker Thomas Cook began offering railway excursions in 1841, first taking around 500 people from Leicester to a teetotal rally in Loughborough on July 5 that year. Passengers were each charged one shilling for the return journey.