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One person close to the negotiations said: “We are rapidly approaching an insoluble impasse precipitated by the banks’ demand for another £200 million of headroom. RBS are pushing hardest, so you could end up with a state-owned bank landing another government department with the cost of repatriating thousands of holidaymakers, not to mention dealing with the fallout from 9,000 UK job loses.”
Another source said that, before the last-minute demand, FTI Consulting, the advisory group representing the interests of the banks in the negotiations, had provided written confirmation that the £900 million cash injection was comfortably sufficient to ensure Thomas Cook could continue to trade through the low-season.
“Just when we thought we were there, Thomas Cook is having to scrabble around trying to underwrite £200 million it does not need,” the source said. “It would only be needed in a worst-case scenario such as a hurricane in the Canary Islands, a terrorist attack or if the pound sunk to a record low. The irony is that, in seeking to ensure the business can survive the winter, RBS may end up tipping it over the edge.”
If Thomas Cook were to collapse, it would affect an estimated 150,000 UK holidaymakers as well more than 500,000 customers in overseas source markets, mostly Germany and Scandinavia.
“Companies and governments across Europe would have to pick for this, said one analyst. “The collapse of Monarch Airlines was big but this would dwarf it.”
The other potential stumbling block to securing the rescue deal comes from a group of bondholders who have credit insurance that pays out in the event of default. The hedge funds, including Sona Asset Management and XAIA Investment, have threatened to vote against the rescue deal unless the insurance — in the form of so-called credit default swaps — pays out.
The hedge funds were concerned that they would have been unable to claim payouts from their insurance under the proposed debt-for-equity swap that forms part of the restructuring. Their hopes of a payout were lifted on Monday when Thomas Cook filed for Chapter 15 bankruptcy protection in a US court, but the holiday company has yet to decide to trigger the payout.
Thomas Cook declined to comment, while RBS has yet to make any comment.

Thomas Cook’s chance of securing its future have been hit by a demand by Royal Bank of Scotland for an extra £200 million of underwritten funds.
If the travel group cannot get the extra £200 million underwritten, it risks going bust, forcing the Civil Aviation Authority, a public corporation of the Department for Transport, to pick up the estimated £600 million cost of repatriating British holidaymakers.
The £200 million was demanded by Thomas Cook’s lending banks, led by RBS and Lloyds, as an extra contingency, providing further liquidity headroom over the winter, the traditional low-cash period for tour operators as they pay out the cash due to hoteliers and other suppliers that they worked with over the summer.
The demand for the financing package to be raised to £1.1 billion has caused consternation, as it came after the key elements of the £900 million refinancing had been agreed at the end of August. The company announced then that “substantial agreement regarding key commercial terms” had been reached by all the main parties to the rescue: Thomas Cook itself, China’s Fosun Tourism Group, a majority of its bondholders and its “core lending banks”.
Thomas Cook, which dates back to 1841, is one of the world’s largest holiday businesses, with 21,000 employees in 16 countries and more than 22 million customers every year. Its debts have left it vulnerable to the weather and to political and economic turmoil, forcing it to accept a rescue deal led by Fosun, the owner of Club Med.
It is understood that the last-minute demand for an extra £200 million standby facility was the main reason why Thomas Cook announced a delay to the key vote by bondholders to rubber-stamp the rescue deal. It was due to be held yesterday but has now been scheduled for next Friday.

In conclusion, we have one big looser here “Shareholders” either by being significantly diluted or wiped out whichever the outcome is they will loose big

“So, buy 30million (of 300m face value) and guarantee that you will get a 300million payout when you force admin.”

Do you really think that any bank’s CDS desk is willing to provide a quote for a TC bond ever since the first recap R S was released!!

As of the 10/09/2019
Under the rules of schemes of arrangement -- a U.K. court
procedure -- the investors will need to hold at least 25% of
Thomas Cook’s bonds to influence the debt restructuring.
Investors hold about $261 million of swaps on Thomas Cook in total, according to the latest data from the International Swaps & Derivatives Association.

I have already stated that the delay is to make sure they have enough votes before they walk into the meeting so no surprises ahead

If you have a bloomberg professional terminal just look up the sizes of the bond which are being traded.

Doesn’t add up to 250K

“and whilst the face value of the debt is in the billions, they are currently trading at 10-11% of face value.”

And who would be willing to take a 90% haircut when there is a potential to convert their massive loss for D4E.

Think before you reply pls

@illbe the delay is to negotiate with bondholders and make sure they can attain 75% of the votes

As for the hedge funds they don’t hold 25% of the bonds, otherwise they won’t be trying and negotiating a pay off. At the end of the day they are vultures and not a charity.

“Under the rules of schemes of arrangement -- a U.K. court
procedure -- the investors will need to hold at least 25% of
Thomas Cook’s bonds to influence the debt restructuring.
Investors hold about $261 million of swaps on Thomas Cook in
total, according to the latest data from the International Swaps
& Derivatives Association.”

TC total bonds amount is EUR1.150bn which is circa $1.265bn, 25% of this figure is roughly $316m.

Simply put they want to go make sure they have enough votes before they walk into the meeting.

JT the same thing happened with debenhams shares “a lot of buys” and it still got delisted. If I was u I wouldn’t put my hopes too high

Kiwikev there are talks in the market that SH will be wiped out not diluted as the BOD previously stated so not even sure why the shares are currently tradable!!

Thomas Cook Files for U.S. Chapter 15 Bankruptcy Protection (1)
2019-09-17 08:33:22.12 GMT

By Irene García Pérez and Katie Linsell
(Bloomberg) -- Thomas Cook Group Plc has filed for Chapter
15 court protection in the U.S. as part of a broader debt
restructuring for the U.K. travel agent.
The company’s Chapter 15 petition was filed in the Southern
District of New York, court papers dated Sept. 16 show. Law firm
Latham & Watkins is representing the company, according to the
documents.
Chapter 15 of U.S. bankruptcy law shields foreign companies
from lawsuits by U.S. creditors while they reorganize in another
country. The filing may also trigger the payout of default
insurance on Thomas Cook debt.
Read more: Thomas Cook Rescue Under Challenge From Hedge-
Funds Plan
The travel agent’s creditors are set to vote on Sept. 27 on
a proposed scheme of arrangement, a U.K. court procedure that
will allow Chinese investor Fosun Tourism Group to lead a
planned rescue of the company.
Thomas Cook proposed to swap 1.67 billion pounds ($2.07
billion) of bank debt and bonds for 15% of the equity and at
least 81 million pounds of new subordinated notes, which will
pay interest with more debt, according to the documents. After
the injection of at least 900 million pounds of new money, Fosun
will hold 75% of the shares of the tour operator arm and up to
25% of the airline.
The case is Thomas Cook Group Plc, 19-12984, U.S.
Bankruptcy Court for the Southern District of New York.

TC would make a great MBA thesis, you can never run out of words even if the thesis was 100,000 words

Just paid attention to the funding size!! So between Thursday last week and today they’ve increased their funding requirements from £1bn to £1.1bn

Yep this is why they were looking to delay the meeting, possibly trying to work some sort of deals with the bondholders

THOMAS COOK has secured an extra week to hammer out a £1.1bn rescue deal, as debt speculators pile pressure on the troubled holiday company.

A meeting had been scheduled for Wednesday to agree terms but is set to be pushed back until next week as Thomas Cook battles to survive.

The rescue deal needs the support of 75pc of creditors to go ahead. Hedge funds are thought to control enough of Thomas Cook's bonds to block the rescue and are pushing for a default unless their demands are met.

Concerns are growing that the world's oldest tour operator could collapse, with hundreds of thousands of holidaymakers facing uncertainty.

Regulators at the Civil Aviation Authority are making contingency plans for what would likely be the biggest ever repatriation of British holidaymakers trapped overseas if an agreement cannot be struck.

Thomas Cook faces a cash crunch as sales fall and it weathers higher fuel and hotel costs, having reported a £1.5bn half-year loss and £1.1bn of write downs in May.

Fosun, the Chinese conglomerate which is Thomas Cook's biggest shareholder with an 18pc stake, has offered to pump in £450m in return for a 75pc stake in the company's tour business and 25pc of its airline.

Lenders and bondholders would put in a similar amount for the remainder of Thomas Cook in a debt-for-equity swap. However, as Thomas Cook needs to start booking next year's hotels in the coming weeks, the amount now required has been upped by £200m to £1.1bn to ensure the business has sufficient headroom to continue operating.

The situation is further complicated by hedge funds taking positions in Thomas Cook's debt. They will vote against the deal unless they are assured their positions will pay out, rather than being wiped out in the restructuring.

However, an insider said: "There is a deal to be done here, it's just a case of getting everyone to understand what's at stake."

Piling on further pressure is Thomas Cook's Air Transport Operator's Licence (Atol) expiration at the end of the month. An Atol protects holidaymakers if their tour company collapses.

Worries about the health of Thomas Cook have caused it shares to collapse to just 5p, valuing the business at £77m, compared with £2bn less than two years ago.

A Thomas Cook spokesman said: "We have reached substantial agreement with bondholders and remain focused on securing the recapitalisation." The CAA refused to be drawn on any potential repatriation plans should Thomas Cook fail, adding it is "in regular contact with all large Atol holders".

5p The Thomas Cook share price, valuing the business at £77m compared with £2bn less than two years ago

Thomas Cook wins more time to thrash out £1.1bn rescue deal - The Telegraph

As if this one week will make a difference!

Quisty what you should ask instead, if the rescue deal get approved... how long will it take them to burn the new injected cash?!?

“Bonds are still tradeable, they can sell them, also Project Mercury suggests that they may recover some cash if liquidation occurs”

They didn’t exit at 50% discount what makes u think they will exit now?!?

The 25% you’re referring to is for the CDS which can be submitted to the court saying we took a speculative position and the bondholders wants to **** us and do a D4E. 51% of the bondholders is needed to go ahead with the deal.

Sharedealer one thing for sure, they have been cooking their books

It’s like watching godfather movie

@illbe

The creditors and bondholders have no choice but to go ahead with the financing. TCG has a negative equity not much for them to salvage if they push it into admin