British tour operator and airline Thomas Cook abruptly collapsed, leaving hundreds of thousands of travelers stranded around the world. Thomas Cook had struggled financially for some time and announced its closing after negotiations to obtain additional emergency financing failed. According to Thomas Cook, about 600,000 people were traveling abroad on its services.
Thomas Cook ran hotels, resorts and airlines for 19 million people a year in 16 countries. The Thomas Cook subsidiary in Belgium said that it was declaring partial bankruptcy and had laid off 75 employees, while its subsidiary in the Netherlands said it had filed for insolvency. However, several companies that were either subsidiaries of Thomas Cook or use the name while running independently were still operating in China, France, Germany, and India. The Chinese subsidiary said that its operations would not be affected by the bankruptcy of the parent company.
The developments at Thomas Cook have raised questions about whether the actions of its leadership may have contributed to the failure. Thomas Cook was struggling with debts approaching £2 billion ($2.49 billion). After negotiations with shareholders and creditors, it needed at least 200 million pounds ($250 million) to continue operations. The British government decided not to bail out the company, on the grounds that it would set a dangerous precedent for other companies.
Initial reports suggest that governments and private companies are moving quickly to bring people home. The head of the Civil Aviation Authority in Britain promised that “nobody” from her country would be stranded. Around 15,000 people have already been flown back to Britain and an additional 135,000 passengers will be repatriated before Oct. 6. Passengers who are traveling after that date will have to make their own arrangements.