TRAVEL company Thomas Cook has confirmed it is seeking £200 million in extra funding as it attempts to prevent a collapse.
The company said it is in talks with stakeholders, including leading shareholder Fosun, to bridge the funding gap to stave off entering administration.
Sources have revealed the firm’s lending banks, including RBS, demanded the extra £200m to provide further contingency.
Sources added that Thomas Cook has “days rather than weeks” to secure the extra cash.
It is understood Thomas Cook had found a third party to provide the extra £200m, but is now rapidly hunting cash after that party backed out.
READ MORE: What would happen if Thomas Cook collapsed?
In an update to the market, Thomas Cook said the fundraiser is expected to significantly dilute existing shareholders’ stakes in the firm, with “significant risk of no recovery”.
If the company goes under, an estimated 180,000 people could be stranded abroad, while the firm employs 22,000 staff around the world including 9,000 in the UK.
Thomas Cook said the £200m needed would be a “seasonal standby facility”, on top of £900m it had already raised from Chinese firm Fosun and its lenders.
The travel firm has suffered recently as a result of mounting debts, reporting a £1.2 billion net debt in its half-year results in May.
It has also been hit hard by an influx of online competitors which has resulted in oversupply, forcing tour operators to cut prices.
An RBS spokesman said: “As one of a number of lenders, RBS has provided considerable support to Thomas Cook over many years and continues to work with all parties in order to try and find a resolution to the funding and liquidity shortfall at Thomas Cook.”
Brian Strutton, general secretary of the British Airline Pilots Association (Balpa), said: “It is appalling that banks that owe their very existence to handouts from the British taxpayer show no allegiance to a great British company, Thomas Cook, when it needs help.
“This puts 9,000 good quality UK jobs needlessly at risk and puts an iconic British brand in jeopardy.”
The 178-year-old firm could go bust by tomorrow, according to insiders.
Government officials have drawn up plans for what would be “Britain’s biggest peacetime repatriation” if the firm goes under.
Known as Operation Matterhorn, it has been put together by the Department for Transport (DfT) and the Civil Aviation Authority, the paper said.
A DfT spokeswoman said: “We do not speculate on the financial situation of individual businesses.”
In the High Court last month, barrister Tom Smith QC, who led Thomas Cook’s legal team, told Justice Norris that the group had a “net debt position” of around £1.25bn.
Shares in the company dived 20.5% to 3.5p earlier yesterday.
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