Thomas Cook collapses: 150,000 travelers stranded
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Thomas Cook check-in desks at London Gatwick Airport. Photo: Rick Findler/PA Images via Getty Images
Thomas Cook, the world's oldest travel firm, confirmed in a statement early Monday that it's gone into administration, immediately ceasing trading and operations.
Why it matters: Per the Financial Times, after weekend rescue package talks between Thomas Cook and the British government, lenders and shareholders broke down, the company's collapse left 150,000 travelers stranded abroad — as the Civil Aviation Authority puts together the "biggest emergency repatriation in peacetime."
What's happening: The collapse means 21,000 employees in 16 countries are set to lose their jobs, including 9,000 people in the United Kingdom, AP reports.
- More than 600,000 travel bookings have been canceled, per AP, which notes an estimated 1 million future vacationers will be affected by booking cancelations. However, many should get refunds under a government travel insurance plan.
- British Transport Secretary Grant Shapps said authorities had hired charter planes to fly customers back free of charge, per the BBC.
What they're saying: Thomas Cook CEO Peter Fankhauser said in the company's statement, "It is a matter of profound regret to me and the rest of the board that we were not successful" in negotiating a deal.
- Schapps defended deciding against giving the 178-year-old British company a requested bail-out, telling the BBC it was a poor candidate for survival because of its substantial debts and focus on main street.
Background: Thomas Cook reported a first half-loss of 1.4 billion pounds ($1.7 billion) earlier this year. The company blamed factors including a prolonged heatwave in 2018 and Brexit uncertainty.
- It said Friday it needed 200 million pounds ($250 million) to avoid financial collapse, AP notes.
- Thomas Cook's largest shareholder, the Chinese company Fosun, had planned to contribute 450 million pounds ($559) in a rescue deal, but the plan fell through, per the FT.
Editor's note: This article has been updated with new details throughout.
