EU Rules

[wing commander]

  Today the official receiver had their court papers signed off as regarding liquidating Thomas Cook.The total debt was a eye watering 3.1 billion pounds,much worse than was anticipated..However what was interesting was this...

 BERLIN, Sept 24 (Reuters) - Germany has decided to guarantee a bridging loan of 380 million euros to Condor, the German airline owned by insolvent British travel operator Thomas Cook, Economy Minister Peter Altmaier said on Tuesday.

"Condor is a profitable company and therefore our decision was based on economic factors, not on political criteria," said Altmaier, adding the decision meant that many of the roughly 5,000 workers would be able to keep their jobs.

Altmaier added that the state of Hesse, where Condor is based, would participate in the financial aid, as previously reported by Reuters.


   So what are the rules on this?? I was under the impression under EU rules company's couldn't be propped up by goverments it has been used as an excuse a few times over the last year or two..
 Dont get me wrong even if it was possible they couldn't do it in this case as it had gone far to far to be rescued but an interesting development none the less..

[Not Now Kato]

https://uk.reuters.com/article/uk-thomas-cook-grp-investment-condor-loa/germany-to-offer-380-million-euro-bridging-loan-to-condor-idUKKBN1W92UA

[Not Now Kato]

   So what are the rules on this?? I was under the impression under EU rules company's couldn't be propped up by goverments it has been used as an excuse a few times over the last year or two..
 Dont get me wrong even if it was possible they couldn't do it in this case as it had gone far to far to be rescued but an interesting development none the less..

From someone inside the business....
 
This is simply a loan, (which is within the EU rules), the terms of which are that it has to be repaid in two weeks time.  It is likely then that Condor, as it is still profitable, will be consumed into Lufthansa in due course.
 
I'm also given to understand that the Scandinavian arm of Thomas Cook will likely continue in business under a new name as it is the most profitable arm of the TC business.

[big fat yorkshire pudding]

Yep it's a loan, loans must be on commercial terms to be permissible as was the initial loan to British steel for example.

By total debt they'll chuck in all liabilities, there will be many assets to offset such the net debt will be far lower.