Arcandor owns 53% of travel company Thomas Cook Germany's Arcandor, which owns 53% of Thomas Cook, has filed for bankruptcy protection after the German government rejected a request for loan guarantees. Arcandor, which employs about 70,000 people, had sought 650m euros ($930m; £561m) of guarantees because about 600m euros of its loans need refinancing. Arcandor said its bankruptcy filing covered German retailer Karstadt and its mail-order businesses. However, it added that Thomas Cook would "remain unaffected". Thomas Cook 'ring-fenced' Thomas Cook is the only profitable part of Arcandor, and the German firm's 52.8% stake in the travel firm is worth about 1bn euros. This will have no impact on holidays - customers should not be concerned whatsoever

Thomas Cook Thomas Cook moved quickly to reassure its customers that they would not be affected by the problems at Arcandor. The holiday operator said it was "completely ring-fenced" from Arcandor and that the two companies were operationally and financially distinct. "We've been around for 167 years and will be for many more," a spokesperson for Thomas Cook told the BBC. "This will have no impact on holidays - customers should not be concerned whatsoever." Shares in Thomas Cook in London closed up 10% at 235.75p, and earlier on Tuesday had jumped as much as 14% on reports that German firm Rewe could buy Arcandor's stake in the travel firm. In a statement, Thomas Cook said it had not received any approach for the stake or the company as a whole. Crisis fund Chancellor Angela Merkel had insisted that no state aid would be available for Arcandor unless the company put together a viable plan and its owners and banks put in more money. WHO IS ARCANDOR? Owned the majority of Thomas Cook since 2007 Owns 120 Karstadt department stores, a mainstay on Germany's High Streets Also owns the Primondo mail-order and Quelle catalogue businesses Arcandor also sells financial products and athletic equipment 50,000 of its employees are based in Germany "This was an unavoidable step, but one which can be used to create new opportunities," Mrs Merkel said. The German government has been reluctant to help Arcandor, because the company was in trouble before the economic crisis. The government has a 100bn-euro fund to provide temporary loans for firms hit by last year's financial crisis and its aftermath, but this does not apply to companies that first got into difficulties before 1 July 2008. Arcandor has been in talks with rival Metro on a merger of their department stores, as well as appealing to the government for help. Reports suggest that Metro was looking into buying 60 of Arcandor's Karstadt stores, and German firm Otto, world's biggest mail order group, might be interested in parts of Primondo. Shares in Arcandor, formerly known as KarstadtQuelle, fell 33% to 71 euro-cents. They were suspended earlier in the day. Shares in the company have dropped 76% this year, and fell 81% last year.



Bookmark with: Delicious

Digg

reddit

Facebook

StumbleUpon What are these? E-mail this to a friend Printable version