Thomas Cook Group Plc was downgraded on Tuesday by Fitch Ratings, which interpreted the announcement of compulsory liquidation together with a number of affiliates as a default on debt outstanding. The long-term grade was therefore lowered to D from C.
The senior unsecured rating and that on bonds including Thomas Cook Group Finance 2 Plc were held at C but their recovery assessment was cut to RR6 (8%) from RR5 (23%). The expectations were weakened by the management's decisions, the agency stressed and estimated the proceeds could come in at a "similar" level "but spread across a wider creditor base." It added it assumes there wouldn't be any restructuring.
The credit appraiser sees the accounts receivable advance rate at 25%, the property plant and equipment advance measure at 30% and the administrative claim at 10%. The bankruptcy is a substantial blow for Fosun International Ltd., the failed tour operator and airline's largest shareholder.
