Ownership of Thomas Cook is poised to change after banks holding almost 44% of shares in the company confirmed their placing on the London Stock Exchange.
Royal Bank of Scotland and Bayern LB and Commerzbank of Germany lead a consortium of creditor banks with control of a 43.9% stake in the group – placed with them by German retailer and current Thomas Cook parent Arcandor as a guarantee for loans.
Arcandor went into bankruptcy protection in June and is now poised to be broken up. Its stake in Thomas Cook is likely to be snapped up by institutional investors.
The possibility of a management buy-out, led by Thomas Cook chief executive Manny Fontenla-Novoa, was ruled out on the grounds it would require £2.5 billion to facilitate a full takeover.
Thomas Cook issued a statement saying the agreement between it and Arcandor would be terminated. Former Arcandor chief executive Karl-Gerhard Eick will resign his position as Thomas Cook chairman and quit the board, and the travel group’s deputy chairman, Michael Beckett, take over as non-executive chairman.
The moves are unlikely to lead to a single investor taking control of Thomas Cook in the short term, but a dominant investor could emerge and make a formal takeover bid. German travel group Rewe is reported to have sought a near 30% stake in Thomas Cook ahead of the share placement.
Thomas Cook’s share price soared in advance of the placing, rising 4.6% the day before and increasing the listed value of the banks’ stake from £869 million at close of trading on September 4 to £922 million on September 9.