Thomas Cook Regulatory News (TCG)

THIS ANNOUNCEMENT IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR IN ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY APPLICABLE LAW

Thomas Cook launches €400 million guaranteed bond

14 January 2015

Thomas Cook Group plc ("Thomas Cook" or the "Company") announces that it intends to raise approximately €400 million in aggregate principal amount from the issuance of guaranteed notes due 2021 (the "Bonds") by Thomas Cook Finance plc (the "Issuer") pursuant to an offering to institutional investors. The Bonds will include a call option in favour of the Issuer exercisable after three years. The Bonds will be guaranteed by the Company's subsidiaries that guaranteed the Issuer's existing notes due 2020.

The transaction will enhance the Company's financial and operational flexibility by:

· further strengthening its financial position by extending and rebalancing the debt maturity profile and increasing liquidity, especially in the context of the forthcoming redemption of the Company's outstanding €400 million 6.75% guaranteed notes due 2015 (the "2015 Notes");

· enabling the cancellation of the Company's highest cost banking facility ("Additional Facility") that was arranged in May 2013 (originally €224 million, since reduced to €164 million) to support the repayment of the 2015 Notes;

· facilitating a future refinancing of the Company's banking facilities maturing in May 2017;

· moving the Company closer to "normalisation" under its existing banking facilities, thereby improving its ability to resume dividend payments; and

· supporting the Company's profitable growth strategy, including through investment in new and improved products.

In order to manage proactively the forthcoming redemption of the 2015 Notes, Thomas Cook intends to launch a tender offer for the 2015 Notes after the end of the close period preceding the announcement of its first quarter financial results on 11th February 2015.

This announcement is not an offer of securities for sale in the United States or any other jurisdiction. Securities may not be offered or sold in the United States unless they are registered or are exempt from registration. The Company and the Issuer do not intend to register any portion of this offering in the United States or to conduct a public offering in the United States or any other jurisdiction. Any public offering of securities to be made in the United States would be made by means of a prospectus that would contain detailed information about the Company and the Issuer and their management, as well as financial statements. Copies of this announcement are not being, and should not be, distributed in or sent into the United States.

Notes to editors:

The Transaction will provide the following benefits in support of the Company's continued transformation and strategy for sustainable profitable growth by:

· Enabling the Company to purchase the 2015 notes pursuant to a tender offer as described above, or redeem the 2015 Notes either at maturity or earlier, while increasing liquidity and extending and rebalancing the Company's debt maturity profile.

· Reducing total bank commitments and potential fees due as a consequence of the size of the commitments through the cancellation of the Additional Facility. The total commitments under the bank facilities entered into in the 2013 recapitalisation amounted to £691 million, subsequently reduced to the current level of £628 million (following the reduction of the Additional Facility from €224 million to €164 million). As previously disclosed, if the Company does not reduce the total commitments to £500 million or lesson 30 June 2015 and £400 million or less on 30 June 2016 then the Company will be obligated to pay its lenders a duration fee of 2% on the total outstanding commitments (approximately £13 million) at each date. Cancellation of the Additional Facility will bring the total commitments below £500 million well in advance of the June 2015 test date.

· Moving the Company closer to achieving "normalisation" under its bank facilities and thereby improving its ability to resume dividend payments. A condition of the banking agreements, as described in the Company's offering memorandum in respect of its €525 million senior guaranteed notes due 2020 published on 16 May 2013, prevents dividends being declared until "normalisation" has been achieved. Normalisation is defined as the point when the Company's total commitments are at or below £400 million and the Company is in pro forma compliance with financial covenants. Through the proceeds of the Bonds, consequent cancellation of the Additional Facility and associated reduction in total bank commitments, the Company will move closer to meeting the requirements of normalisation.

· Freeing up cash flow generated by the business to support the Company's profitable growth strategy, including through the continued investment in higher return concept and partnership hotels.

THIS OFFERING IS AVAILABLE ONLY TO INVESTORS WHO ARE EITHER (1) QUALIFIED INSTITUTIONAL BUYERS (''QIBs'') WITHIN THE MEANING OF RULE 144A UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE ''U.S. SECURITIES ACT''), OR (2) NON-U.S. PERSONS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE U.S. SECURITIES ACT.

It may be unlawful to distribute this announcement in certain jurisdictions. This announcement is not for distribution in the United States, Japan or Australia. The information in this announcement does not constitute an offer of securities for sale in the United States, Canada, Japan or Australia. The securities mentioned herein have not been, and will not be, registered under the U.S. Securities Act. Any securities contemplated herein may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act. There will be no public offer of securities in the United States.

This communication is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) the high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). The securities are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with relevant persons. Any person who is not a relevant person should not act or rely on this communication or any of its contents.

This announcement contains ''forward-looking statements'' that are based on estimates and assumptions and are subject to risks and uncertainties. Forward-looking statements are all statements other than statements of historical fact or statements in the present tense, and can be identified by words such as "targets", "aims", "aspires", "assumes" ''believes'', ''estimates'', ''anticipates'', ''expects'', ''intends'', "hopes", ''may'', ''would'', ''should'', "could", ''will'', ''plans'', ''predicts'' and ''potential'', as well as the negatives of these terms and other words of similar meaning. The forward-looking statements in this announcement are made based upon the Company's estimates, expectations and beliefs concerning future events affecting the Group and are subject to a number of known and unknown risks and uncertainties. Such forward-looking statements are based on numerous assumptions regarding the Group's present and future business strategies and the environment in which it will operate, which may prove not to be accurate. The Company cautions that these forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in these forward-looking statements. Undue reliance should, therefore, not be placed on such forward-looking statements. Any forward-looking statements contained in this announcement apply only as at the date of this announcement and are not intended to give any assurance as to future results. The Company will update this announcement as required by applicable law, including the Prospectus Rules, the Listing Rules, the Disclosure and Transparency Rules, and any other applicable law or regulations, but otherwise expressly disclaims any obligation or undertaking to update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

The contents of this announcement are not to be construed as legal, business or tax advice. Each prospective investor should consult his or its own legal adviser, financial adviser or tax adviser for legal, financial or tax advice. Any investment decision made in connection with the Notes issue must be based solely on the information contained in the final offering memorandum. The final offering memorandum will be available only to persons who are resident in jurisdictions where an offer of the Notes would not be unlawful and is for distribution to institutional and professional investors and/or other persons to whom an invitation or inducement to purchase the Notes may otherwise lawfully be communicated or caused to be communicated. Prior to relying on the information contained in the final offering memorandum you must ascertain from the final offering memorandum whether or not you are eligible to receive it.

Stabilisation in respect of the Bonds may be conducted in accordance with applicable laws.