Industry insiders question Kockars wealth9 Aug 2019 20:52
For full article, see Travel Weekly out 9th August .
The reality for Thomas Cook shareholders
Fosun outlined its plans for Thomas Cook last week in a series of meetings with creditor banks and bondholders.
The UK’s Mail on Sunday newspaper reported Fosun plans to attract more Chinese visitors to Europe and will establish new destination management organisations (DMOs) to assist Chinese visitors in destinations such as Egypt and the Greek islands.
Fosun also intends to increase Thomas Cook’s winter sports, adventure holidays, city breaks, music festival packages and sales of Club Med holidays and develop the group’s hotel brands.
Fankhauser told German trade magazine FVW this week: “I can rule out Thomas Cook getting a Chinese look.
“We have worked successfully with Fosun for four years. The Fosun management values the Thomas Cook brand.”
A group of Thomas Cook’s bondholders are now in negotiations with Fosun and Thomas Cook as completion of the deal moves nearer.
Fosun is not proposing to buy Thomas Cook’s shares. It proposes to recapitalise the company in a deal with the banks. Fosun is not going to buy up the recently purchased shares.
Thomas Cook’s shareholders, new and old, stand to lose all but a nominal holding in the revamped company – likely to be no more than a single-digit percentage share of the Thomas Cook plc which will be owned by the banks and bondholders.
Shares are available for Kockar and Rodionova to buy because the big institutional investors in Thomas Cook have been selling down their stakes.
The purchase of those shares has caused a small leap in the share price in the past fortnight and this small-scale volatility may continue until the final deal is laid out.
It may attract the interest of the odd investment analyst. But it’s irrelevant in the scheme of things. The real news will come in September.
When Thomas Cook announced the deal last month, it noted it was in “advanced discussions” with Fosun and its banks. It is hard to see the deal being derailed by the odd outside punt.
Fankhauser acknowledged then that the deal would not please shareholders.
“This is not the outcome any of us wanted for our shareholders,” he said, but added: “This is a pragmatic and responsible solution which provides the means to secure the future of the Thomas Cook business for our customers, suppliers and employees.”
That is the reality.
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