Published on Wednesday, July 10, 2019

Cox & Kings shares down after IATA suspends license

Shares in travel firm Cox & Kings sank again by 5% after the International Air Transport Association suspended its Billing and Settlement Plan license.

IATA is sufficiently concerned over Cox & Kings' liquidity to pull its BSP line of credit, following the company's default on two debt repayments recently.

In a stock market filing Cox & Kings said it would continue to issue tickets on cash and carry basis, and would therefore have to settle the value of airlines tickets issued on a weekly basis.

It defaulted on two commercial papers after a series of credit downgrades, blaming a 'cash flow mismatch.'

"The working capital situation at Cox & Kings stretched in the last few months and was further impacted due to its inability to replace the short term loans with long term loans and regular working capital lines," it said.

To ease the debt burden the company is mulling a sale of some of its assets.

Indian media report the visa processing business Cox & Kings Global Services and its corporate travel business could be sold.

Last year it sold off European education tour business subsidiary Holiday Break to Midlothian Capital Partners, and said at the time the funds would go toward servicing its debt.

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