Nov. 23 - Thomas Cook CEO plans asset sales to re coup hundreds of millions of pounds to the ailing travel company balance sheet and is to stop its run of mergers and acquisitions. Penny Tweedie reports.
Thomas Cook - the ailing UK based travel company was licking its wounds after a day that saw its shares plummet almost 75 per cent. Shares in Europe's second biggest travel company rallied a little on Wednesday after interim CEO, Sam Weihagen went to the media with a message of hope and asset sales. The company has run an aggressive policy of mergers and acquisitions since 2007 at a cost of around 500 million pounds. Weihagen says this will now stop as they put into place a two-pronged attack on their financial situation aimed at getting down debt. SOUNDBITE: Sam Weihagen, acting CEO , Thomas Cook, saying: (English) "One was a restructure of the UK business the other one to strengthen our balance sheet - and we will strengthen our balance sheet by selling off assets so we are now validated various assets in our businesses to see if they are core business or if they are assets we could dispose of and we h ave started the disposal of process by selling some hotels in Spain." The company was started 170 years ago by British born Thomas Cook and is regarded as the inventor of the package holiday. But investors are unsentimental about a company which is now worth only around 100 million pounds and carries almost a billion pounds worth of debt. One target is likely to be the 1000 or more high street outlets accrued in the UK at a time when more and more people are booking online. But Weihagen remains upbeat about its long term future and some analysts believe Thomas Cook is simply too big to be allowed to fail. SOUNDBITE: Sam Weihagen, acting CEO , Thomas Cook, saying: (English) "Thomas Cook has been around for a long time , it is a big, great company and we have been sending customers out of the UK overseas for over 100 year. Millions of British customers have been travelling with us and I am very sure they will continue to travel with us next year as well." But fraught political situations in key north African destinations and flooding in Thailand mean the holiday industry is facing exceptional times. It won't be easy for Thomas Cook to rebalance its accounts when holiday bookings are uncertain and its financial position providing the worst kind of publicity. Penny Tweedie, Reuters