The German government and the state government of Hesse have granted the charter airline Condor, a subsidiary of Thomas Cook, a bridging loan worth 380 million euros (420 million dollars), the company confirmed late Tuesday.
Earlier on Tuesday, the finance minister of the central German state Hesse, Thomas Schaefer, had said that the state could carry 50 per cent of the loan and Berlin would carry the other half.
“We have a tried-and-tested procedure for these situations. The federal government takes half, and the affected state takes the other half. Seeing as Condor is a company from Hesse, the other half would go to Hesse,” Schaefer said in an interview with local broadcaster Hessischer Rundfunk.
Speaking in Berlin on the sidelines of an industrial conference, German Economy Minister Peter Altmaier noted that Condor’s problems were “not self-made” but due to the bankruptcy of its parent company.
It remains to be seen whether an investor might want to take over the company with its 4,900 employees.
Another Thomas Cook subsidiary, Thomas Cook Germany, has also applied for a bridging loan from the German government, a spokeswoman confirmed. The spokeswoman did not say how much it was asking for.
Both Thomas Cook Germany and Condor are solvent businesses.
British tour operator Thomas Cook collapsed and filed for liquidation on Monday. The collapse has left tens of thousands of holidaymakers stranded and local tourism industries bracing for a financial blow.
All Condor flights were operating as planned on Tuesday, a spokesman said. Special teams have been deployed to airports to answer any questions that passengers may have.
The company’s management has been in touch with suppliers and partner firms to keep its carriers in the air.
The British government on Tuesday defended its own refusal to bail out the storied British travel brand.
Business Secretary Andrea Leadsom told broadcaster Sky News that the 200-million-pound (250-million-dollar) rescue the parent company was seeking would have been “a waste of taxpayers’ money” as it would have required much more to stay afloat in the long term.
Britain’s Press Association also reported Tuesday that there were questions over pay packages for Thomas Cook’s bosses. The news agency reported that top executives earned more than 16 million pounds in salary and bonuses between them over the past five years.
Thomas Cook Germany, which operates German brands Neckermann, Oeger Tours, Air Marin and Bucher Reisen, has put new bookings and flights on hold through September 26, a spokesman said on Tuesday.
The Thomas Cook bankruptcy is also affecting clients of its main competitor, Tui. British travellers who had booked flights with Thomas Cook Airlines through Tui until October 31 will not be able to travel, a Tui spokesman said on Tuesday in Hanover.
For clients who are already travelling and whose flights have been cancelled because of the insolvency, alternative flights will be offered.
