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UPDATE 1-UK holiday firm Thomas Cook agrees key terms of rescue deal

Reuters | London | Updated: 28-08-2019 12:32 IST | Created: 28-08-2019 12:27 IST
UPDATE 1-UK holiday firm Thomas Cook agrees key terms of rescue deal
Image Credit: Wikimedia

British tour operator Thomas Cook Group said on Wednesday it had reached substantial agreement on the key commercial terms of a rescue package with investor Fosun Tourism, its banks and a majority of its bondholders.

The package tour pioneer said in July it was working to secure new investment from shareholder Fosun Tourism, which would see the Hong Kong group take control of the business, along with its lenders whose debt would be converted into equity. The terms announced on Wednesday will see Fosun contribute 450 million pounds ($552 million) of new money in return for at least 75% of the tour operator business and 25% of the group's airline.

Thomas Cook's lending banks and noteholders will stump up a further 450 million pounds and convert their existing debt to equity, giving them in total about 75% of the airline and up to 25% in the tour operator business, the group said. The recapitalization plan will result in a significant dilution in existing shareholders' interests, the company said, but it had decided it was the best way to secure the future of the group for all its stakeholders.



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