Thomas Cook India unaffected as UK operator collapses
23 Sep 2019
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Thomas Cook India, earlier part of the UK-based Thomas Cook Plc, is completely disconnected with the UK operator post acquisition by Fairfax in 2012, says its chairman.
Thomas Cook India said the financial crisis faced by its former promoter and British tour operator Thomas Cook Plc will not in any way impact the Indian firm.
"We continue to grow and build our legacy as an independent entity after Fairfax Financial Holdings acquired a 77 per cent stake in Thomas Cook India in 2012," company chairman Madhavan Menon said in a statement on Saturday.
The company’s statement follows reports of financial crisis at Thomas Cook Plc which could result in the company going in bankruptcy. The UK operator is seeking $250 million in emergency funding and reports indicate it has approached the government for financial support.
Thomas Cook Plc, meanwhile, is reported to have declared bankruptcy after failing to reach a last-ditch rescue deal, triggering the UK’s biggest repatriation since World War II to bring back stranded passengers.
The 178-year-old operator had been desperately seeking £200 million ($250 million, 227 million euros) from private investors to save it from collapse.
"Despite considerable efforts, those discussions have not resulted in agreement between the company's stakeholders and proposed new money providers," Thomas Cook said in a statement. "The company's board has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect."
The government said it had hired planes to fly home an estimated 150,000 holidaymakers to the UK, in an operation starting on Monday.
"Following the collapse of Thomas Cook and the cancellation of all its flights, Transport Secretary Grant Shapps has announced that the government and UK Civil Aviation Authority has hired dozens of charter planes to fly customers home free of charge," a separate statement said, describing it as the largest repatriation in peacetime history.
"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."
Thomas Cook chief executive Peter Fankhauser called it a "deeply sad day". "It is a matter of profound regret to me and the rest of the board that we were not successful," he said.
"This marks a deeply sad day for the company which pioneered package holidays and made travel possible for millions of people around the world," he added in the group's statement.
The firm's creditors on Sunday met to try and work out a deal, followed by a meeting of the board of directors. Reports said a collapse of the group would mean the repatriation of 600,000 tourists, including around 150,000 seeking government help returning to the UK.
Two years ago, the collapse of Monarch Airlines prompted the British government to take emergency action to return 110,000 stranded passengers, costing taxpayers some £60 million on hiring planes.
Thomas Cook has been forced to shut travel agencies, and ground its planes, leaving the group's 22,000 global employees — 9,000 of whom are in Britain — out of job.
China’s Fosun, which is the biggest shareholder in Thomas Cook, agreed last month to inject £450 million into the business as part of an initial £900 million rescue package. The Hong Kong-listed conglomerate also acquired a 75 per cent stake in Thomas Cook's tour operating division and 25 per cent of its airline unit.
Thomas Cook’s collapse is reported to have been caused in part by Brexit uncertainty that delayed summer holiday bookings. The group, which has around 600 stores across the UK, has also come under pressure from fierce online competition.
Thomas Cook created the travel firm in 1841 to carry 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, to the United States in 1866 and on round-the-world trips in 1872.
The company was also a pioneer in introducing "circular note" that have later become traveller's cheques.
