Beleaguered Thomas Cook has unloaded gold and hotel business in Spain to help slash debt which has crippled their business of late. The 170 year old company will be selling their stake in Hoteles Y Clubs De Vacaciones for a reported £72 million. The news comes in advance of delayed Thomas Cook annual results which will almost certainly spur massive store closings and job losses.
Two weeks ago Thomas Cook announced their delaying of announcing balance sheet results, signaling what many feel is a death spiral the company established in 1841. Cash is the only answer for TC, as the company readily admits trading has proven pitiful these last months. The company needs to buy time to regroup and gather resources to move forward. Thomas Cook employs more than 30,000 people worldwide, but experts are predicting the company will shut down about 20 percent of their shops shortly.
Interim CEO Sam Weihagen painted today’s deal as demonstrative of Thomas Cook’s commitment for bumbing up their accounting sheets, but any floundering company has to have this as a priority, obviously. Shares of Thomas Cook fell 70% as soon as the company revealed they had trouble. This divestiture, while an obvious move to reduce debt, may not inspire much confidence, at least not until the company’s true complexion is revealed with the coming report.
This Is Money reported Thomas Cook will still have access to the hotels via the buyer Iberostar. The reader may want to follow TC on Twitter, or visit their Facebook profile here. While Sam Weihagen’s statements in the video below last month speak of firm financial ground, no one in the travel or any business could consider divestiture and cutting thousands of jobs steady “business as usual” as the interim CEO suggests. We will keep you updated.