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Companies That You Expect to Disappear Soon

yorksrob

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But that's how they make their money. They "buy" these companies with borrowed money, hollow out the company for personal gain, and then let the company fold. The unsecured creditors can go whistle, but their "loans" are always secured so they get what they "loaned" in the first place.

Whole things stinks.

It is why so many of these companies are going bust. It's nothing to do with trading conditions- tough as they are- and everything to do with unsustainable debt repayments being dumped on them by asset-stripping venture capitalists.

This is why we don't have a robust layer of 'mittelstrand' medium sized businesses to keep the country ticking over in the same way that other countries do.

The ability to buy up companies using debt needs to be clamped down on heavily.
 
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FQTV

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When does Thomas Cook have to pay that ATOL fee? I have a feeling it's today.

1st October I read yesterday

Correct, but the recent Chapter 15 protection filing in the US is only obliquely connected to this.

Also obliquely, there was quite a significant increase in demand for traditional package tours, sold face-to-face, following the Icelandic ash cloud situation some years ago. Travellers who were overseas with tour operators, after some intitial hiccups, were looked after completely. Those who had booked themselves, on- or offline, found themselves in much worse positions.

The profile of customers in high street agents, booking tour operator packages, is not overly skewed towards those who are either older or less tech-savvy.

Traditional agents perform a useful function of providing tightly-presented, no-fuss arrangements, with options to pay small deposits up-front, split payments for groups of families and friends, to stay at properties which may not otherwise accept ‘transient’ bookings, with on-site representatives, operator-provided kids’ clubs, activities, tours and entertainment etc.

The issue here is likely to be the way that the company has been run internally, and possibly competitive pressures from others such as TUI.

Offering a more traditional product and service in what’s a growing market anyway is not, in this case, likely to be the main problem, but abandoning that niche could be catastrophic.
 

cactustwirly

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Correct, but the recent Chapter 15 protection filing in the US is only obliquely connected to this.

Also obliquely, there was quite a significant increase in demand for traditional package tours, sold face-to-face, following the Icelandic ash cloud situation some years ago. Travellers who were overseas with tour operators, after some intitial hiccups, were looked after completely. Those who had booked themselves, on- or offline, found themselves in much worse positions.

The profile of customers in high street agents, booking tour operator packages, is not overly skewed towards those who are either older or less tech-savvy.

Traditional agents perform a useful function of providing tightly-presented, no-fuss arrangements, with options to pay small deposits up-front, split payments for groups of families and friends, to stay at properties which may not otherwise accept ‘transient’ bookings, with on-site representatives, operator-provided kids’ clubs, activities, tours and entertainment etc.

The issue here is likely to be the way that the company has been run internally, and possibly competitive pressures from others such as TUI.

Offering a more traditional product and service in what’s a growing market anyway is not, in this case, likely to be the main problem, but abandoning that niche could be catastrophic.

I work for a Travel agent, and all our bookings are taken online, we're a niche company, who own the accomodation as well.
We offer very similar services to that of TC and TUI, but without the large overheads of high street stores.
 

cactustwirly

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Well unless they're bought by the 30th, they're not going to make it and will suffer the same fate as Monarch.

Well done for pointing out the blindingly obvious!
There is a plan for a cash injection from Fosun, it just needs approval from the current shareholders
 

FQTV

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I work for a Travel agent, and all our bookings are taken online, we're a niche company, who own the accomodation as well.
We offer very similar services to that of TC and TUI, but without the large overheads of high street stores.

That's your company's niche then, and most successful companies obviously need one (or a few). However, I would posit that your customer base may not be exactly the same as Thomas Cook, TUI or even Hays Travel's - even if there are similarities in the product or basic service offered.

If it is the same, however, then TUI's £19bn European turnover and 1600 physical store portfolio is presumably there for the taking, plus Thomas Cook's £9bn and 600 UK stores.
 

Busaholic

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1st October I read yesterday
That's right, and during the first week of October 486,000 passengers are booked on Thomas Cook flights according to aviation data firm OAG. The Monarch Airlines collapse would be a picnic compared to Thomas Cook should it collapse, with approx half those people requiring repatriation, a job which the Civil Aviation Authority would have to oversee.
 

johntea

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Somewhere mentioned if they got bailed out by the government it would cost roughly half of getting everyone back home but surely if they’re already in so much trouble it would only be a short term fix

Cue everyone on social media complaining their travel insurance refused to pay out because they went for the £2 insurance rather than the £20 insurance! (Or didn’t bother with travel insurance to begin with...)
 

158756

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Somewhere mentioned if they got bailed out by the government it would cost roughly half of getting everyone back home but surely if they’re already in so much trouble it would only be a short term fix

Cue everyone on social media complaining their travel insurance refused to pay out because they went for the £2 insurance rather than the £20 insurance! (Or didn’t bother with travel insurance to begin with...)

£600m is being put about as the cost of repatriation. For 150,000 passengers, mostly around the Med, that's £4000 per head - someone's making a tidy profit on that.
 

Howardh

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I'm flying out with Ryanair on the 27th Sept, and back from Ibiza with Thomas Cook airlines on the 2nd Oct. Clearly I'm not atol-protected, so I have protected myself by buying a separate flight today IBZ>Barcelona>Man by Veulling which leaves a couple of hours later than the scheduled TC flight, so if Cooks survive I can take their plane, and if they are liquidated as I am in the queue, I have a flight booked two hours later. Cost me £120 but I get peace of mind for a few days holiday.

If Cooks fail then the cost of that rescue flight is bound to increase!!!
In fact just looking at Sky News it seems Cook have all but gone and are seeking help from the UK government *some chance!), so £120 well spent and my credit card should refund the original fare.
 
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I’m supposed to go on holiday to Zante for two weeks with my mum and dad and we’re flying with Thomas Cook.
 
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Thomas Cook has ceased trading!
I was just at the airport when the announcement was made (02:20). At least I’m not stranded abroad :D
 

ainsworth74

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Just a quick note to say that we do have a thread on Thomas Cook which can be found here. No need to carry on the discussion about the same issue in two places :)
 

ainsworth74

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I'm not sure what the Forum's emergency meal venue will become if they go under! We rely on a health supply of Pizza Express location to fall back on when all else fails!! :lol:
 

cactustwirly

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I'm not sure what the Forum's emergency meal venue will become if they go under! We rely on a health supply of Pizza Express location to fall back on when all else fails!! :lol:

There's always Zizzis, that's infinitely better!
 

Tetchytyke

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They’ll be fine. Cash flow is good, just a pile of debt, some of which they will probably restructure (at best) default on (quite likely).

Another profitable company saddled with the debts taken out by the private equity vultures to buy it in the first place. £1.1bn debt for a pizza shop! Madness.

Sooner it's clamped down on, the better.
 

Bletchleyite

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Another profitable company saddled with the debts taken out by the private equity vultures to buy it in the first place. £1.1bn debt for a pizza shop! Madness.

Sooner it's clamped down on, the better.

Agreed. A total ban on leveraged takeovers and short-selling would be of substantial benefit.

IOW, if you want to buy it, you have to have the readies in the bank to do so, and if you want to sell shares you have to own them at the point you sold them.
 

deltic

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Norwegian Air and Build a Bear are two very different companies that are being talked about as being in trouble
 

Iskra

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Agreed. A total ban on leveraged takeovers and short-selling would be of substantial benefit.

IOW, if you want to buy it, you have to have the readies in the bank to do so, and if you want to sell shares you have to own them at the point you sold them.

Agreed. Private equity is bad news. It also means those companies don't pay taxes in the UK as taxes are paid on profits, which they officially aren't making because of the debt they owe to their foreign-based parent companies ...if a private individual did the same thing there would be uproar.

I do think Pizza Express is poor though, you can find much better, non-frozen food at a similar price. They also have too many outlets so I wouldn't be surprised to see a reduction in them, but they aren't going to disappear.
 

ainsworth74

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They also have too many outlets so I wouldn't be surprised to see a reduction in them, but they aren't going to disappear.

I was thinking that. I was looking at Liverpool recently and there are four Pizza Express restaurants within an area of maybe a square mile at most. Now Liverpool is a vibrant city it has to be said but four that close together? They might all be busy on Friday/Saturday but I can't help but wonder how they do the rest of the week and whether they're really that profitable on the back of just one or two days...
 

LOL The Irony

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I was thinking that. I was looking at Liverpool recently and there are four Pizza Express restaurants within an area of maybe a square mile at most. Now Liverpool is a vibrant city it has to be said but four that close together? They might all be busy on Friday/Saturday but I can't help but wonder how they do the rest of the week and whether they're really that profitable on the back of just one or two days...
Well any restructuring would look at that and decide if they're viable.
 

d9009alycidon

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Norwegian Air and Build a Bear are two very different companies that are being talked about as being in trouble

Hope Norwegian Air keep going, I fly regularly to Oslo and they are the only direct flight from Scotland (Edinburgh), booked to go next at the end of October.
 

Tetchytyke

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I can't help but wonder how they do the rest of the week and whether they're really that profitable on the back of just one or two days...

The company makes a profit before the debt charges, so they must be doing something right.

The issue is purely the leveraged takeovers.
 

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