Thomas Cook sees its price fall after shareholder pleaReported by Metro.co.uk on Tuesday, 15 May 2012 (on May 15, 2012)
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*Thomas Cook shares have dropped ten per cent after the company warned shareholders it was in danger of collapse if they failed to back two disposals.*
Thomas Cook's shares have dropped (Picture: PA)
The travel company watched as its price flopped from 21.25p at the start of the day to close at 19.25p, leaving it valued at £166.7million.
A circular warned the company, which asked lenders for an additional £100million in November, could go under if shareholders did not approve the planned sale and leaseback of part of its fleet of aircraft and the disposal of five Spanish hotels.
Thomas Cook said it was confident shareholders would deliver the required majority when they vote on the disposals at a general meeting in London later this month.
But Douglas McNeill, an analyst at Charles Stanley Securities, said: ‘To our way of thinking, the share price indicates the probability of insolvency is more than 35 per cent – and we find that too pessimistic.
‘Since shareholder approval seems unlikely to be withheld, this would seem to be something of an academic issue.’
Thomas Cook has confirmed winter losses of £262.7million, with poor performances in North Africa and France.
Second-half year bookings have been more encouraging but much depends on the ‘lates’ market.
Thomas Cook’s turnaround plan in Britain includes a focus on fewer, better-quality hotels and an increase in online bookings.
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