Thomas Cook shares tumble as it seeks extra £150million – is your holiday safe?
THOMAS Cook shares tumbled today after the travel firm announced it was seeking another £150million bailout.
The troubled tour operator had already asked investors for £750million back in May to stave off collapse but now it is asking for more cash to survive the winter.
Britain's oldest travel firm has struggled in recent months with mounting debts and reports of a £1.5billion loss in its half-year results.
An influx of online competitors onto the market meant that tour operators across the board had to cut prices, including Thomas Cook.
It had previously said that the earlier cash injection - which included £450million from its majority stakeholder Fosun, with the rest from lenders - would covers costs until the end of the year.
At the time, shares dropped to a low of 10p but later rose again by 17 per cent.
How do I know if my holiday is ATOL protected?
WHEN you book a holiday, the ATOL holder or their agent must give you a certificate confirming you are ATOL protected as soon as you hand over any money - including a deposit - for a holiday or flight.
Make sure you obtain and keep all the relevant paperwork in case you need to make a claim.
But be aware, the protection only covers British-based firms, so it's vital to check. When Lowcostholidays went bust in 2016, customers weren't protected by ATOL because the company had moved to Spain in 2013.
Some travel companies display the ATOL logo on their websites even though they don't offer financial protection.
To check it's genuine, look for a number on the logo and check it out on the CAA's website.
You should be wary if the travel provider has no ATOL number, or if the number doesn't have four or five digits.
If you aren't sure about the website, don't book through it.
Another key term Brits should be aware of is ABTA. While ATOL protects flight-based packages, ABTA protects everything else such as cruise or self-drive trips.
In a statement to investors, the company said the extra cash would "further liquidity headroom" during the quieter Christmas months.
As a result, shares slumped further to 6.2p from 8.33p earlier in the day, according to the London Stock Exchange.
It's a far cry from the 85p they were worth this time last year, prompting fears that shareholders would be wiped out by the refinancing.
The company is looking for a buyer for its tour operator business, where Fosun is likely to take a majority stake and a minority in the airline side.
In a statement, Thomas Cook said that since the last payout it has "made significant progress" and that the new cash injection will "ensure the business can continue to invest in its strategy".
What does it mean for your holiday?
As it stands, the company is still operating as normal so any holiday you have booked with them will go ahead.
But in the unlikely even of the company going bust, you can rest assured that all Thomas Cook package holidays are protected by the Air Travel Organisers' Licence - or ATOL.
It means you won't be stranded abroad if the company goes bust and refunded for trips that can't go ahead.
The travel firm is also a member of ABTA - Association of British Travel Agents - which means you'll be entitled to a refund it your holiday is cancelled before you set off, or get you home if you're already abroad.
But if part of the company is sold the dates, hotel or flights may change.
Flight-only bookings are not protected by ABTA or ATOL so you won't have the same cover - although you may be able to get a refund
If you're thinking about booking a trip with the firm, make sure you pay by credit or debit card as you may be able to get your money back through your provider if anything goes wrong.
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You should also take out a travel insurance policy that covers you if an airline or tour operator goes bust.
ABTA warns that not many insurance policies will cover this so you may need to take out an add-on policy.
See our cheap travel insurance guide for top tips to getting the best cover.
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