Thomas Cook is reportedly seeking an additional £100m in funding from lenders on top of the £900m proposed last month as it warns it could face collapse if a deal is not finalised this month.
Talks between Thomas Cook and stakeholders resulted in a request for an additional standby borrowing facility to give reassurance to its lending banks, according to Sky News.
A City source said the facility was not expected to be drawn upon and Thomas Cook believes the £900m will be enough.
However, the banks’ support is vital for a deal to be agreed.
Podcast: Thomas Cook rescue deal
Meanwhile, in a court filing Thomas Cook said it was running out of time to secure its future.
The document, dated August 30, stated: “The serious liquidity issues within the group have led to an urgent need to complete any restructuring within September.
“[Any] delay would make it impossible to implement a restructuring transaction within September, and the Scheme Companies would be likely to run out of money and enter into formal insolvency proceedings.”
Thomas Cook’s board has been meeting for the last two days to discuss the best way to finalise the restructure before the company runs out of cash.
The first stakeholder vote is due to take place next week.
One source quoted in Sky News said the deal looked “harder and more complicated than it did a few days ago”.
Thomas Cook needs to finalise the terms by the end of September to pay suppliers and to ensure it can renew its Atol licence.
The travel giant is in crucial talks with Chinese investor Fosun over the terms of the deal that would see it inject £450 million while banks and lenders match that with a debt for equity swap.
The deal would see Fosun take a 75% stake in Thomas Cook’s tour operating and hotel division and 25% stake in its airlines
The rescue could mean the ending of Thomas Cook’s public stock market listing, meaning shareholders are likely to lose their investments in the company.
Last weekend, reports said the firm’s pension scheme had demanded terms to sweeten the deal that would guarantee the continuation of existing annual contributions of £25 million.
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