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Time: 2019-09-23 04:58:35 UTC

Original URL: https://www.businessinsider.com/thomas-cook-bankrupt-airline-stranded-rescue-2019-9 [businessinsider.com] using UTF-8 encoding.

Title: 600k travelers are stranded after Thomas Cook declares bankruptcy

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600k travelers are stranded after Thomas Cook declares bankruptcy

Arthur T Knackerbracket has found the following story [businessinsider.com]:

Thomas Cook, a 178-year-old British travel company and airline, declared bankruptcy early Monday morning, suspending operations and leaving hundreds of thousands of tourists stranded around the world.

The travel company operates its own airline, with a fleet of nearly 50 medium- and long-range jets, and owns several smaller airlines and subsidiaries, including the German carrier Condor. Thomas Cook still had several flights in the air as of Sunday night but was expected to cease operations once they landed at their destinations.

Condor posted a message to its site late Sunday night saying that it was still operating but that it was unclear whether that would change. Condor's scheduled Monday-morning flights appeared to be operating normally.

About 600,000 Thomas Cook customers were traveling at the time of the collapse, of whom 150,000 were British, the company told CNN [cnn.com].

The British Department for Transport and Civil Aviation Authority prepared plans, under the code name "Operation Matterhorn," to repatriate stranded British passengers. According to the British aviation authority, those rescue flights would take place until October 6, leading to the possibility that travelers could be delayed for up to two weeks.

Initial rescue flights seemed poised to begin immediately, with stranded passengers posting on Twitter that they were being delayed only a few hours as they awaited chartered flights.

The scale of the task has reports calling it the largest peacetime repatriation effort in British history, including the operation the government carried out when Monarch Airlines collapsed [businessinsider.com] in 2017.

Costs of the flights were expected to be covered by the ATOL [caa.co.uk], or Air Travel Organiser's License, protection plan, a fund that provides for repatriation of British travelers if an airline ceases operations.

Airplanes from British Airways and easyJet would be among those transporting stranded passengers home, according to The Guardian [theguardian.com], as well as chartered planes from leasing companies and other airlines. Thomas Cook Airlines' destinations included parts of mainland Europe, Africa, the US, the Caribbean, and the Middle East. Airplanes were being flown to those destinations on Sunday night, according to the BBC [bbc.com].

The company was still selling tickets until Sunday night in the UK.

One Plymouth, England-based traveler who had booked a vacation to the Greek island of Zakynthos for August 2020 told Business Insider that she saw Thomas Cook had charged her more than £600 by direct debit on Sunday afternoon for the trip but that she was not due to be charged until Thursday. It was unclear whether she would be able to recoup the funds with the bankruptcy declaration. She asked not to be named.

Stranded passengers can find more information at the UK Civil Aviation Authority's website [caa.co.uk], or its 24-hour hotline: 0300 303 2800 from the UK and Ireland and 44 1753 330 330 from overseas.

On Sunday, Thomas Cook was left scrambling to secure £200 million, or about $249 million, in emergency funding following a demand from its lenders. The company's executives were believed to have met Sunday with the company's biggest shareholder and creditors at a London law firm, according to Sky News [sky.com] and iTV [itv.com].

Reports indicated that the tour operator failed to secure the needed funds during the meeting.

Though Thomas Cook had reached an agreement for a £900 million rescue deal, with the Chinese company Fosun Tourism Group providing half of that funding, creditors had demanded the British company secure an additional £200 million.

Thomas Cook owns a Nordic operation, as well as airlines in the UK, Germany, and northern Europe — proposals to fund those, while letting the UK tour operating arm fail, were deemed unfeasible, according to Sky News, as have several other options that would take too long to implement. It was not immediately clear whether Condor was being funded separately.

Thomas Cook, as well as a union representing some of its 9,000 UK employees, had sought an emergency funding plan from the British government. Government sources, however, "had questioned the financial wisdom of stepping in to save the company," according to the BBC [bbc.com]. The company employs 21,000 globally.

The company had filed [bloomberg.com] for Chapter 15 bankruptcy protection in the US last week, though it stopped short of declaring insolvency.

While Thomas Cook managed to recover from a risk of insolvency in 2011, it continued to be held back by lingering debts. It also suffered by lower demand over the past two summer travel seasons, as major heat waves led many Britons to stay home. Brexit uncertainties and a weak pound also contributed, according to The Telegraph [telegraph.co.uk].

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