China’s Fosun in talks to invest USD 940 million in Thomas Cook
Jul 12, 2019 (China Knowledge) - China’s Fosun Tourism Group is negotiating with Thomas Cook and its lenders regarding a combined fund-raising campaign worth USD 940 million. This proposal deal is one of the most important purchases of a British company by a Chinese group in recent years.
Fosun Tourism will take control of the core packaged-tour business and a minority interest in an airline business of Thomas Cook. Thomas Cook is currently looking for large amount of its external bank and bond debt will be changed into equity, and its existing shareholders’ stakes will be diluted after the recapitalization.
Thomas Cook’s stock has halved in value so far this year, with a current value of about USD 255 million. Its board has decided to move forward to recapitalize the business after evaluating a broad range of options to reduce debt, according to Thomas Cook’s Chief Executive Peter Fankhauser.
Fosun Tourism is already Thomas Cook’s biggest shareholder with an 18 % stake. “We are committed investors and have extensive experience in turning around iconic brands including Club Med and Wolverhampton Wanderers FC,” confidently states Fosun Tourism. Up until now, it has not announced how much of the capital injection will be self-funded and how much would come from lenders.
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