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About The Group (Thomas Cook Group plc)

Thomas Cook Group plc was a British global travel group. It was formed on 19 June 2007 by the merger of Thomas Cook AG and MyTravel Group.

 

The group operated in two separate segments: a tour operator and an airline. It also operated travel agencies in Europe. On 23 September 2019 Thomas Cook Group and all UK entities went into compulsory liquidation.

 

Thomas Cook was listed on both the London Stock Exchange and the Frankfurt Stock Exchange. The Thomas Cook Group ceased trading on 23 September 2019.

 

Approximately 21,000 worldwide employees were left without jobs (including 9,000 UK staff).

 

After the collapse, segments of the company were purchased by others, including the travel stores in the UK, the airlines, the Thomas Cook name and logo, the hotel brands and the tour operators.

 Thomas Cook India was not affected, as Thomas Cook India is an entirely different entity since August 2012 when it was acquired by Fairfax Financial.

Full history of the group

Formation

 

In February 2007, it was announced that Thomas Cook AG and MyTravel Group plc were to merge. The companies announced they expected to make savings of over £75 million a year, following the integration of the two businesses. Under the terms of the merger, the owners of Thomas Cook AG, owned 52% of the new group. The shareholders of MyTravel Group owned the remaining 48% share. The merger was completed in June 2007, and was then listed on the London Stock Exchange under the name of Thomas Cook Group plc.

 

2008–2009

 

On 14 February 2008, Thomas Cook bought booking website Hotels4U.com for £21.8 million. On 6 March 2008, the company bought back its licence to operate the Thomas Cook brand in the Middle East and Asia from the Dubai Investment Group for an amount estimated to be around 249 million euros. 

 

In April 2008 Thomas Cook bought the luxury travel firm Elegant Resorts from its founders Geoff Moss and Barbara Catchpole for an undisclosed figure.

 The company took over Preston-based Gold Medal International, owner of NetFlights, in a deal worth £87 million in December 2008.

 

On 8 March 2009, Thomas Cook signed a deal with Octopus Media Technology to host, upload, and provide an online video player for Thomas Cook TV.

 

In Spring 2009 Thomas Cook UK signed a deal with International Entertainment Supplier The E3 Group, to exclusively supply entertainment to the group.

 

In June 2009, Thomas Cook’s majority shareholder Arcandor filed for bankruptcy, although the group was not affected.

Arcandor’s shares in Thomas Cook were sold by its creditor banks in September 2009.

 

2010–2015

 

In July 2010, Thomas Cook Group bought German tourism company Öger Tours, which was owned by Vural Öger.

 

In 2010, the Thomas Cook Group reached an agreement with The Co-operative Group to merge its branch network with that of The Co-operative Travel. The merger was approved by the Competition Commission in 2011, and the joint venture was 66.5% owned by the Thomas Cook Group, 30% owned by The Co-operative Group and 3.5% owned by the Midlands Co-operative.  

The merger created the UK’s largest travel network. Thomas Cook’s ‘Going Places’ branded branches were rebranded under the Co-operative’s brand.

 

In May 2012, Harriet Green was appointed as the chief executive officer of Thomas Cook Group, succeeding Manny Fontenla-Novoa, who was CEO from 2003 until August 2011. On 1 July 2013, Thomas Cook announced that it would cease publishing the Thomas Cook European Timetable, along with closure of the rest of its publishing business. The final edition of the timetable was published in August 2013, but publication resumed in early 2014 under a new publishing company not affiliated with Thomas Cook.

 

In February 2014 Thomas Cook Group sold Gold Medal Travel, including Netflights.com, to dnata for a reported £45 million.

 

On 26 November 2014, it was announced that Green was leaving with immediate effect, and that COO Peter Fankhauser would take over as CEO.

 

2016–2018

 

In 2016 the Co-operative Group decided that it would exercise its option to quit the branch network joint venture. Thomas Cook Group announced it would buy out the stakes in The Co-operative Travel owned by The Co-operative Group and Central England Co-operative, taking full control of the retail network and re-branding the high street travel stores that had operated under the Co-operative brand gradually during 2017–18.

 

In March 2017, Thomas Cook announced the sale of its Belgian airline operations to Lufthansa. As a result, Thomas Cook Airlines Belgium was shut down by November 2017 with two aircraft and all traffic rights being handed to Brussels Airlines. Its three remaining aircraft were relocated to sister companies.

 

In November 2018, business analysts suggested that Thomas Cook should split the business to help recover its financial health.

 

2019: Final year and collapse

In February 2019, the Financial Times newspaper said that the Thomas Cook Group had received bids for its airline business, which includes Condor, and also the company as a whole.

 

 In March 2019, Thomas Cook UK announced 21 travel office closures and the redundancy of 300 staff, justifying the decision with the fact that 64% of bookings had been made online in 2018.

 

In May 2019 the company reported that it had secured £300 million of emergency funding from its banks.

 

Then in May 2019, the company announced a loss of £1.5 billion for the first half of its financial year, with £1.1 billion of the loss being attributable to goodwill write-downs.

 

In June 2019, Thomas Cook said that it was in talks with the Chinese company Fosun International with regard to the possible sale of its tour operator business.

 

 On 28 August 2019, Thomas Cook announced that Fosun would pay £450 million for 75% of the firm’s tour business and 25% of its airline.

 

By September 2019, Thomas Cook Group was “the most shorted company on the London Stock Exchange,” and reports began to emerge that the company was “in last minute negotiations” with bondholders, in order to approve the Fosun takeover.

 

 Less than a week later, Thomas Cook asked HM Government to fund a £200 million gap in the company’s finances to prevent the firm falling into administration.

 

 The company had by that point secured £900m in funding as part of a debt-for-equity swap, including £450m from Fosun.

 

Despite this, a late demand is reported to have emerged from the Group’s funders, including Royal Bank of Scotland and Halifax, who insisted that the Group be sufficiently recapitalised to ensure operations were protected through to January, when bookings are traditionally quieter and liquidity would be challenging.

This demand meant the group needed an extra £200 million of funding to keep the company operational.

 

These efforts did not succeed, with the UK Government Secretary of State for Transport Grant Shapps rejecting any discussion of UK intervention.

 

A final failed attempt to prevent the Thomas Cook Group from administration or liquidation took place the evening of 22 September 2019. At around midnight on 23 September, airports in the UK began to impound Thomas Cook aircraft upon arrival, citing “default in payment of airport charges”. Shortly after 02:00 BST, the Civil Aviation Authority (CAA) announced that the Thomas Cook Group had entered liquidation and ceased operations with immediate effect, leaving around 600,000 tourists overseas. The collapse of the company marked the end of a brand name that had been in continuous use since 1841.