LONDON (AGENCE FRANCE-PRESSE) – British travel company Thomas Cook collapsed yesterday, leaving some 600,000 holidaymakers stranded and sparking the country’s biggest repatriation since World War II.

The 178-year-old debt-plagued group, which had struggled against fierce online competition for some time and blamed Brexit uncertainty for a drop in bookings, failed to secure £200 million (S$343 million) from private investors and collapsed in the early hours.

The bankruptcy, which followed a long period of chronic financial turmoil after a disastrous 2007 merger deal, left some 600,000 tourists stranded worldwide and 22,000 employees jobless.

Britain’s government has launched emergency plans to bring home some 150,000 British holidaymakers from destinations including Bulgaria, Cuba, Turkey and the United States.

Launching Britain’s “largest repatriation in peacetime history”, Transport Secretary Grant Shapps said the government and UK Civil Aviation Authority had hired dozens of charter planes to fly home Thomas Cook customers.

Thomas Cook said in a statement that “despite considerable efforts”, it was unable to reach an agreement between its stakeholders and proposed new money providers.

“The company’s board has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect,” it added.

The group has also been blighted by huge costs arising from its disastrous 2007 merger with MyTravel, a deal which left it plagued with high levels of debt.

Both a tour operator and an airline, the travel giant’s key destinations were in Southern Europe and the Mediterranean but it also offered holidays in Asia, North Africa and the Caribbean.

“It is a matter of profound regret to me and the rest of the board that we were not successful,” said Thomas Cook chief executive Peter Fankhauser, adding: “This marks a deeply sad day for the company.”

As well as grounding its planes, Thomas Cook has been forced to shut travel agencies, leaving its 22,000 global employees – 9,000 of them in Britain – out of a job.

DEEPLY SAD

It is a matter of profound regret to me and the rest of the board that we were not successful. This marks a deeply sad day for the company.

THOMAS COOK CHIEF EXECUTIVE PETER FANKHAUSER

Chinese peer Fosun, which was already the biggest shareholder in Thomas Cook, had agreed last month to inject £450 million into the business as part of an initial £900 million rescue package.

In return, the Hong Kong-listed conglomerate was to acquire a 75 per cent stake in Thomas Cook’s tour operating division and 25 per cent of its airline unit.

“Fosun is disappointed that Thomas Cook Group has not been able to find a viable solution for its proposed recapitalisation with other affiliates, core lending banks, senior noteholders and additional involved parties,” the Chinese group said in a statement.

The travel firm was founded by cabinet maker Thomas Cook in 1841 to transport temperance supporters by train between British cities.

It soon began arranging foreign trips, being the first operator to take British travellers on escorted visits to Europe in 1855, followed soon after by destinations farther afield.

Thomas Cook grew into a huge operation but fell into massive debt despite recent annual turnover of £10 billion from transporting about 20 million customers worldwide.

The tour operator’s demise caps a dramatic fall from grace for a company which was ejected from London’s prestigious FTSE 100 stock index in 2010 – and from the second-tier FTSE 250 last year. Its shares are worthless and now suspended.

The company’s failure comes just two years after the collapse of Monarch Airlines, which led to the British government taking emergency action to fly home 110,000 stranded passengers. The operation to hire planes cost taxpayers £60 million.

“A rescue package would likely have amounted to little more than delaying the inevitable and simply throwing good money after bad,” said Mr David Cheetham, an analyst for online broker XTB.

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