Reports of talks held by Thomas Cook about selling off a minority stake in its airline have led to further speculation about a possible splitting up of the travel giant.
Quoting an unnamed industry source, The Sunday Times, claims internal discussions have been held about freeing up cash to pay down debt by separating the airline from the tour operation.
The newspaper said that any plans are at an early stage and nothing was likely to happen imminently although the move could “reinvigorate” the company.
But it claimed that Thomas Cook’s financial position of having £886 million of debt and annual profit of just £12 million from £9 billion of turnover is “widely seen as unsustainable”.
The Sunday Times said any break-up would be complicated by the need for Thomas Cook to guarantee seats for its customers but that could be solved by an agreement between the airline and tour operator.
It said the creation of a single airline brand within the group has “paved the way for a potential split”.
Thomas Cook told the newspaper: “Thomas Cook has consistently said that we are open to playing our part in consolidation where it makes sense for our business. We have no current plans to sell our airline.”
The operator is due to issue an update to shareholders this week, the Sunday Times saying the City is expecting trading to have been tough.