THOMAS COOK ON THE BRINK

Fears travel giant could go bust within 48 hours

THOMAS Cook was on the brink of collapse last night, plunging the holiday plans of hundreds of thousands of customers into turmoil.

Despite battling to secure a rescue deal, the 178-year- old travel firm could go bust as early as Sunday, according to company insiders.

It would leave 180,000 customers stranded abroad – and dash the plans of hundreds of thousands of families who have booked Thomas Cook flights or holidays.

The company’s demise would also lead to huge job losses and leave the taxpayer facing a hefty bill to bring stranded customers home.

The Mail can reveal that Whitehall officials have already drawn up plans for what would be Britain’s biggest peacetime repatriation. Known as Operation Matterhorn, it has been put together by the Department for Transport and the Civil Aviation Authority.

Senior sources suggested it could take up to two weeks to bring all Thomas Cook c ustomers home if t he company goes under.

Thomas Cook has been struggling with £1.6 billion of debt and tumbling profits.

Debt-fuelled expansion and poor bets on where Britons would want to travel and how many people would book flights has left its finances in crisis.

The company is locked in desperate negotiations with its lenders, Royal Bank of Scotland and Lloyds Bank, over a salvage deal.

In July, bosses announced they were hammering out a rescue deal with Chinese company Fosun, Thomas Cook’s largest shareholder, and a group of hedge funds which owned its bonds.

But a group of banks, includi ng RBS, are apparently threatening to scupper the deal. They are demanding an extra £200million be pumped i nto the rescue package, sources close to Thomas Cook said. Unless RBS backs down, Thomas Cook’s board will have to call in administrators within days.

Last night, Thomas Cook was bombarded by messages on social media from customers worried about t heir holiday plans. On its Twitter site, Thomas Cook assured holidaymakers that it would be around ‘for many years’.

But an industry source said: ‘Unless the management team can point to a viable transaction soon, they have a clear legal duty to cease trading.

‘To put it bluntly, they’re running out of options.’

If Thomas Cook does fail, the taxpayer will be left with a huge bill. It would cost about £600million to bring home the 180,000 Thomas Cook customers who would be abroad if the company collapsed early next week, industry experts estimate. Thomas Cook package holidays are protected by the Atol scheme, which means customers are supposed to be brought home free of personal cost and refunded for any holidays which do not go ahead.

However, customers who bought only flights through Thomas Cook would not be protected under the scheme.

At the moment, the scheme – which is funded by the travel companies via a l evy on travellers – contains only £ 18million and i s not big enough to cover the costs of a Thomas Cook collapse.

The Mail understands this would leave the Department f or Transport having to scratch around for the rest.

Last night, RBS denied it was responsible for putting pressure on the deal.

Thomas Cook declined to comment.

‘They’re running out of options’