The sudden failure of the travel company giant has raised alarm bells in the tourism industry worldwide. In fact, 38 countries are affected by the situation, particularly in Europe and more than 8.6 million flight seats will be cancelled from now until end of August 2020, according to the last flights programming (for the period 1st September 2019 – 31st August 2020) announced by the company at the beginning of this month.
Thomas Cook India is an entirely separate entity from Thomas Cook PLC in the UK and it has no stake in Thomas Cook (India) Limited since August 2012
Madhavan Menon, Chairman & Managing Director, Thomas Cook (India) Ltd, repeated, “Regarding the collapse of Thomas Cook PLC in the UK, I categorically reiterate – it is business as usual for Thomas Cook India which is a completely independent entity, acquired by Canada based Fairfax Financial Holdings in August 2012 from Thomas Cook in the UK.
He added, “The Thomas Cook India Group’s cash and bank deposits balances stand at Rs. 13,890 million as of June 30, 2019. Thomas Cook India is debt-free upon pre-payment of Rs. 670 million debenture obligations ahead of schedule. This has been made possible using growing and sustainable cash flows that the Thomas Cook India Group generates year over year. The Group generates an average annual free cash flow of around Rs. 2500 million.”
Package holidays booked through Thomas Cook are protected under the CAA’s Atol (Air Travel Organiser’s Licence) scheme. This means each customer will be given a replacement holiday of the same value or refund if an operator collapses before they embark.
According to the Financial Times, Thomas Cook came close to collapse eight years before and took on large loans to survive. Tough trading conditions have been exacerbated by Brexit uncertainty.