Bloomberg News

Thomas Cook Cuts Borrowing Cost With Extended Bank Loans

July 18, 2011

(Updates with interest margins in second paragraph.)

July 18 (Bloomberg) -- Thomas Cook Group Plc, Europe’s second-largest tour operator, said it lowered interest margins on 1.05 billion pounds ($1.7 billion) of bank loans and extended the maturity by one year to 2014.

It will pay interest of 225 basis points more than the London interbank offered rate on a 200 million-pound term loan and a margin of between 200 and 250 basis points for 850 million pounds of revolving credit, the London-based company said in a statement today.

Thomas Cook agreed to pay initial interest of 275 basis points more than Libor when it signed the loans last year, according to the statement. A basis point is 0.01 percentage point.

“We are focused on reducing our debt and strengthening our balance sheet and we have a number of initiatives underway to deliver progress on this including the disposal of certain hotel and surplus assets,” Chief Financial Officer Paul Hollingworth said in the statement.

--Editors: Cecile Gutscher, Andrew Reierson

To contact the reporter on this story: Patricia Kuo in London at pkuo2@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net


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