Thomas Cook sells Spanish hotel chain for €72.2 mn; to close 200 shops
14 Dec 2011
Thomas Cook Group plc, Europe's largest tour operator and UK's second largest foreign exchange group, will close 200 of its travel agencies over the next two years after posting losses of nearly £400 million in the first six months of 2011.
The closure is 125 more than already announced by Thomas Cook, which had earlier announced plans to shut 75 stores indicated earlier this year when Thomas Cook merged with Co-Operative Travel (See: Thomas Cook, Co-operative Travel tie-up creates UK's largest travel agency).
The closure will leave the world's oldest travel agency with about 1,100 high street travel offices across the UK.
The debt-ridden company was hoping to raise £200 million by selling assets such as hotels and its stake in UK's air traffic control service.
Yesterday it sold its Spanish hotel chain, Hotels Y Clubs De Vacaciones to Grupo Iberostar for €72.2 million as part of its plan to reduce debt.
The company blamed the nearly £400 million loss in the first six months of 2011 to the floods in Thailand and the uprisings in Egypt and Tunisia.
The group, which sells more than 22 million holidays a year in the UK, has been forced to go to lenders twice this year in order to secure additional £100 million loan.
Manny Fontenla-Novoa, who had led Thomas Cook since 2007 as CEO, resigned in August 2011 after three profit warnings in a year amid weak demand for travel triggered an 80 per cent decline in its share price since March.
