Iconic British travel services provider Thomas Cook on Monday declared bankruptcy, putting the future of the 178-year-old operator in doubt. The collapse could leave up to 600,000 tourists stranded worldwide; nearly 150,000 of these are from the UK.
Thomas Cook had sought approximately $250 million from private investors in discussions to save itself from collapse.
In a statement issued on Monday morning, Thomas Cook informed, “Despite considerable efforts, those discussions have not resulted in agreement between the company's stakeholders and proposed new money providers. The company's board has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect."
Thomas Cook, which began operations in 1841 as a provider of railway tours, had emerged as a global brand that offered booking services, package trips and flights via its eponymous airline. Thomas Cook was a travel industry pioneer, offering organised tours of Europe in 1855, the US in 1866 and even round-the-world tours in 1872. Thomas Cook was also a pioneer in the use of the payment method that became known as the traveller's cheque.
Following the collapse of Thomas Cook, the British government announced it had hired charter flights to fly home nearly 150,000 holidaymakers back to the UK. Media reports described it as the biggest “peacetime repatriation” in the UK since World War II.
"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. 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,” a statement said.
In addition to shutting down Thomas Cook airlines, the company has stopped operations of its travel agencies, endangering the future of around 22,000 employees globally.
Thomas Cook has been facing market stress on account of aggressive online competition.
Thomas Cook (India) separate company, unaffected
Thomas Cook (India) announced on Sunday that the financial woes of the UK-based company would not affect it as both were different entities. In August 2012, 77 per cent of Thomas Cook UK's stake in Indian operations was acquired by Fairfax Financial Holdings (Fairfax), a Canadian company. With the divestment, Thomas Cook UK also ceased to be a promoter of the India-based company.
