TRAVEL: British travel firm Thomas Cook collapses thousands stranded in Cyprus

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Thousands of holidaymakers were left stranded in Cyprus as the world’s oldest travel firm Thomas Cook collapsed on Monday with the UK government scrambling to fly them home.


The collapse of the UK travel firm, which ran hotels, resorts and airlines carrying a reportedly 19 million people a year to 16 countries, is set to spark the largest peacetime repatriation effort in British history.

Estimates say that some 600,000 travels are stranded at their holiday destination.

UK Transport Secretary Grant Shapps said it is estimated to cost the British government close to EUR 100 mln to repatriate 150,000 stranded Brits.

The British High Commissioner in Nicosia said it is working on a plan to repatriate all British citizens currently stranded on the island with between 5,000 to 8,000 thought to be on Cyprus.

The firm’s collapse is another blow to Cyprus hotel and tourism industry as the firm operated package holidays for some 250,000 of tourists in Cyprus with its airline and through its travel agency.

Thomas Cook’s collapse follows the demise of Cypriot Cobalt Air and Germany’s Germania budget airlines which carried significant number of tourists to the island.

An emergency meeting was convened at the Junior Ministry of Tourism to assess the magnitude of the impact of Thomas Cook's bankruptcy.

Cypriot hoteliers estimate that the industry will suffer major financial losses as they were earning some EUR 50m a year from Thomas Cook’s activities, according to President of the Association of Cyprus Tourist Enterprises (ACTE), Akis Vavlitis.

ACTE and the Cyprus Hotels Association (CHA), and the travel agents' association are expected to convene to assess the negative impacts on their members and to determine ways of managing the problem.

Hotels say they haven’t been paid by Thomas Cook for July and August.

Dinos Kakouras, chairman of the Association of Cyprus Travel Agencies, told StockWatch that Thomas Cook would prepay 50% of the bookings agreed with the tour partners for the next tourist season.

This means that there will be a problem with payments for the upcoming tourist season.

“We hope that other tour operators will soon replace the piece of travel pie Thomas Cook brought to Cyprus,” said Vavlitis.

Talking to CyBC radio, Maria Kouroupi, senior manager at Hermes Airports, estimated that around 8,000 holidaymakers have been left stranded on the island.

Kouroupi said that three companies operating under the Thomas Cook umbrella, including its Scandinavian and German subsidiaries carried some 450,000 tourists annually to Cyprus, conducting some 2,000 flights.

Up until Sunday, the three companies had carried out 1,750 flights bringing 368,000 holidaymakers to Cyprus.

The liquidation marks the end of one of Britain’s oldest companies that started life in 1841 running local rail excursions before it survived two world wars to pioneer package holidays and mass tourism.

Thomas Cook announced its bankruptcy in the early hours of Monday and, as the company, which had already been put into liquidation, failed to find the necessary funds to survive.

A spokeswoman said Thomas Cook had applied for a winding-up, expressing deep regret over the financial collapse of the company, which has a history of 178 years.

The company announced its bankruptcy after failing to find some GBP 250 mln needed to keep its operations alive.

Thomas Cook had secured, about 900 mln pounds after coming to an agreement Chinese company Fosun last August, but the deal fell through as British banks demanded that the UK government increase the state guarantees to GBP 200 mln. The company’s debt amounts to GBP 1.7 bln.

Thomas Cook employees over 22,000 employees worldwide, with 9,00 in the UK.

Thomas Cook’s downfall is due to a number of negative factors such as political turmoil at holiday destinations covered by the company, such as Turkey, last summer's heatwave, Brexit uncertainty, and customers who have grown accustomed to booking last minute getaways online.