£1.4bn life­line for Cook jobs

The Peterborough Evening Telegraph - - FRONT PAGE - By PAUL GRIN­NELL paul.grin­nell@pe­ter­bor­oughto­day.co.uk twit­ter@paulgrin­nell2

Loan deal will safe­guard fu­ture of city-based travel gi­ant

HUN­DREDS of staff at a lead­ing Peter­bor­ough em­ployer can breathe a sign of re­lief to­day af­ter the firm was thrown a £1.4bil­lion life­line by its banks.

Bosses of travel gi­ant Thomas Cook, which has about 1,600 staff at its head­quar­ters in Bret­ton, have just put the final de­tails to a three year deal with its banks that is ex­pected to se­cure the firm’s fu­ture.

The deal has been thrashed out with about 17 banks, which in­cluded Bar­clays and the RBS.

News of the deal comes seven months af­ter the 171-year-old com­pany was on the verge of run­ning out of cash and had to call on its banks for a £200 mil­lion loan.

A Thomas Cook spokesman said: “This is a very sig­nif­i­cant deal for Thomas Cook.

“It means that any con­cerns for the fu­ture that staff may have had can be put away.

He added: “It means the fu­ture is look­ing fine for the long term.”

In a state­ment, Sam Wei­ha­gen, group chief ex­ec­u­tive for Thomas Cook, said: “This an­nounce­ment high­lights the con­fi­dence our lenders have in Thomas Cook and we are de­lighted they have demon­strated their on­go­ing sup­port.

He added: “We con­tinue to make good progress in strength­en­ing our fi­nan­cial po­si­tion.”

He said plans to sell some as­sets in­clud­ing HCV Ho­tels, its In­dian busi­ness and the pro­posed sale and lease­back of its air­craft were an im­por­tant step.

Mr Wei­ha­gen said: “These will en­sure Thomas Cook con­tin­ues to pro­vide cus­tomers with won­der­ful travel ex­pe­ri­ence for years to come.”

Af­ter­wards a spokesman for the TSSA union, said: “We are re­ally pleased that Thomas Cook has now se­cured a long term fi­nan­cial agree­ment that will en­sure its re­turn as a ma­jor player in the travel in­dus­try.

“We hope that this will be the start of a new chap­ter af­ter the dis­as­trous man­age­ment style of for­mer chief ex­ec­u­tive Manny Fon­tenlaNovoa who took ridicu­lously large re­wards for bring­ing the com­pany to its knees.

He said the new deal would help safe­guard the jobs of hun­dreds of peo­ple who worked for Thomas Cook.

At the start of the year, Thomas Cook re­vealed that Mr Fon­tenla-novoa re­ceived a £1.17 mil­lion pay­out from the com­pany af­ter he re­signed.

He stepped down in Au­gust last year, weeks af­ter the com­pany had is­sued its third prof­its warn­ing for the year and which saw its share price drop by about 30 per cent.

In Fe­bru­ary, the firm an­nounced a £91 mil­lion un­der­ly­ing loss from its op­er­a­tions for the last three months of 2001.

It blamed ris­ing fuel costs, trou­ble in North Africa and a drop in book­ings for its fi­nan­cial woes.

Peter­bor­ough MP Ste­wart Jack­son raised the firm’s plight in the House of Com­mons prompt­ing Prime Min­is­ter David Cameron to pledge that Busi­ness Sec­re­tary Vince Cable would be asked to re­port on the firm.

Thomas Cook shares closed at 21p on Fri­day; a year ago they were worth more than 170p.

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