Thomas Cook nears a £1.2bn deal over debt

 
Marion Dakers
STRUGGLING holiday group Thomas Cook confirmed yesterday that it is close to a deal to roll over some of its £1.2bn debt pile.

The 170-year-old firm said it is in “advanced talks” and expects to have an agreement with its lenders, who include RBS and Barclays, in time for its half-year results in May.

Thomas Cook added that it was looking into selling and leasing back some of its planes in order to release cash.

The travel group has been forced to consider a raft of fundraising proposals after it issued three profit warnings last year due to families cutting back on holidays and the soaring popularity of travel websites.

Those close to the firm said shareholders could lose out as lenders look to take an equity stake of up to five per cent and hike interest rates in return for extending the loan deadlines.

Interim chief executive Sam Weihagen has spent months trying to thrash out a deal with lenders as sales continued to slide.

A syndicate of 17 banks have been in talks since November, when they agreed a £200m rescue package, over easing pressure on Thomas Cook by extending its loan facilities through to 2015.

Last month Thomas Cook reported that bookings were beginning to stabilise, following a dire 2011 that led to the departure of veteran chief executive Manny Fontenla-Novoa in August.

The firm has seen “a good level of interest” in its Indian business, which was put up for sale in February as part of a strategic review.