DID BOSSES KNOW A MONTH AGO?

Business Minister demands probe as it emerges travel giant’s lenders raised alarm in August

THOMAS Cook bosses may have known more than a month ago that the travel giant was on the verge of collapse, it emerged last night.

The true state of the 178-year-old company’s precarious finances became public knowledge last Thursday, sparking panic among investors.

Leaks to the media revealed that Thomas Cook needed an extra £200million to secure a rescue deal. The firm collapsed in the early hours of Monday morning, leaving more than 150,000 customers stranded and sparking the UK’s biggest peacetime repatriation.

Thomas Cook was still selling flights and holiday packages online as late as Sunday night – just hours before it collapsed.

Now, as tens of thousands of holidaymakers wait to be taken home, the spotlight is on the bosses who ran the firm into the ground.

Business Secretary Andrea Leadsom has called for the Insolvency Service to launch a ‘fast track’ investigation into the firm’s demise, likely to examine exactly what bosses knew – and when. In a witness statement to the High Court on Sunday, Thomas Cook head Peter Fankhauser claimed the company’s lenders demanded more money to secure its future just two weeks before its collapse.

This led to frantic talks with City investors and the company eventually begging the Government for financial support, Mr Fankhauser said. But it last night emerged that the lenders, including Royal Bank of Scotland (RBS) and Lloyds Bank, had called for the extra funding at the beginning of August in a report circulated by their advisers.

Sources close to the banks have questioned why Thomas Cook did little to plug the gap earlier. Under strict UK stock market rules, companies must declare important information that could affect their share price.

The firm’s shares crashed by more than a fifth when it finally disclosed the demand for an extra £200million last Friday – but only after reports that it was on the brink of collapse were leaked to the media the day before.

Last night, veteran MP Frank Field, chairman of the work and pensions committee, said: ‘If this is true, either the finance officer at Thomas Cook is completely incompetent or was dissembling the truth. People got huge salaries because they claimed to be incredibly good at their job.’

The contradictory accounts of the events have kicked off a spat between Thomas Cook’s board and the lenders, which – until recently – were due to help the stricken travel agent secure a major rescue deal.

The planned bailout, which also involved Chinese tourism firm Fosun and a group of investors who held the company’s bonds, originally involved £900million of new money being ploughed in to the travel agent.

But as worries grew about the troubled company’s financial position, RBS and the other banks suggested an extra £200million be added to the deal to ensure Thomas Cook could keep going through the slow winter months.

Sources close to the banks have claimed this was flagged to Thomas Cook as early as the beginning of August. But Mr Fankhauser said they suddenly insisted the extra £200million was essential on September 9, giving the firm little time to find an investor to stump up the cash. According to Mr Fankhauser’s statement, made when he applied to put the business into liquidation on Sunday, the banks expected the money to come from Fosun.

But the Chinese giant was unwilling to write out any more cheques on top of the £450million it had committed. The crumbling firm is now facing a series of investigations. The Transport Salaried Staffs’ Association union has warned that rival Tui may now hold a dangerously large share of the British travel market.

‘Contradictory accounts of the events’