Thomas Cook turns to advisors amid turmoil

Struggling tour firm Thomas Cook is facing restructuring and advisors have been commissioned.

Travel Insurance News - 24/11/2011

<< Qantas talks with pilots end | Travel News | Some single trip travel insurance excludes winter sports >>

The news comes days after Citigroup clients received memos warning them not to put a target price on Thomas Cook shares. The company’s stock has since plummeted by 75 percentage points as the company struggles to raise additional capital via loans that could push its total debts to more than £1 billion.

The company has now brought in advisors, which has raised the possibility of a full restructuring after officials admitted on Tuesday that the firm was close to breaching terms associated with its current loans.

Broker firms have continued to issue ‘sell’ advisories, citing that the world’s oldest travel company had little time left to convince consumers and markets that it was still a safe bet. Lloyds Banking Group, Thomas Cook’s largest shareholder and one of its 17 lenders, has pulled nearly half of all its shares, bringing its total holdings to just 4.59 per cent.

Meanwhile analysts say that the company could easily undergo restructuring. One suggested that advisors have been brought in to help to take the emotion out of the situation, as direct talks between Thomas Cook and banks were likely difficult at this point.

<< Qantas talks with pilots end | Travel News | Some single trip travel insurance excludes winter sports >>