Thomas Cook’s stark warning to shareholders
Thomas Cook has warned shareholders that unless they approve the sale of some of its aircraft and its interest in a Spanish hotel chain, the tour operator could be in trouble.
It has called a general meeting on 29 May for shareholders to approve the sale and leaseback of 17 of its aircraft and the disposal of five Spanish hotels.
If agreed it will see the sale of its interest in Spanish hotel chain Hoteles Y Clubs De Vacaciones (HCV) complete as quickly as 29 June, the Aircastle aircraft disposals by 30 June and Guggenheim aircraft by 31 July, raising £238.8 million in total for the operator.
But if shareholders do not support the move, it could jeopardise the recent £1.4 billion refinancing package which gives Thomas Cook a further three years to repay its debts.
In the information sent to shareholders, Thomas Cook said that "the Company is of the opinion that, if any one or all of the Disposal Resolutions is not passed, the Retained Group will not have sufficient working capital for its present requirements, that is, for at least the next 12 months following the date of publication of this Circular".
The shareholder circular showed Thomas Cook had losses of £262.7 million in the six months to March 2012 compared to losses of £165.8 in the six months to March 2011.
The tour operator is still looking to sell its stake in air traffic control service, NATS and its part of currency exchange business Thomas Cook India.
On announcing the sale and lease back of 17 aircraft on Friday, CEO Sam Weihagen said that first half seasonal losses had widened but that summer bookings had improved in recent weeks, see previous story.
Average selling price is stable, up 4%, and bookings for independent and specialist businesses are up 11%. Net debt as of March 31 was £1.39 billion.
The company appointed ex-Kwik Fit finance boss Michael Healy as chief financial officer last week and is believed to be close to appointing a new chief executive.
By Diane Evans
Diane
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