Duo take lead roles on rescue package for troubled travel giant

Simmons & Simmons and Allen & Overy (A&O) have taken lead roles on the rescue of stricken UK travel giant Thomas Cook.

Thomas Cook, which appeared to be on the brink of bankruptcy last week, negotiated a £200m loan facility on 25 November with a consortium of banks 
led by Barclays, HSBC, RBS and UniCredit.

The loan replaces a £100m short-term facility agreed in October. In addition, the banks have agreed to relax the financial covenants on the existing loan facilities, with the company stating that the agreement gives it "much increased headroom to deal with unexpected events and the effects of an uncertain economic environment."

Simmons advised Thomas Cook with a City team led by finance partner Simon Middleton that also included City finance partner Adam Cooper and capital markets partner Charles Hawes. Slaughter and May corporate and finance partners William Underhill and George Seligman advised Thomas Cook alongside Simmons. Advising the banks, A&O floated a team led by City finance partner George Link.

Both firms also advised on the travel company's £2bn refinancing in 2010, with Simmons pitching against a number of magic circle firms, including longstanding adviser Slaughters for the mandate.

News of the deal, announced at the same time as a review of the business, came after growing questions about the future of Thomas Cook. After issuing several profit warnings, the company's share price was falling sharply and Thomas Cook said it was delaying reporting its preliminary results for the 12 months ending 30 September until it had concluded the 
loan negotiations.

It has now said it will announce these results during the week commencing 
12 December, with the company also launching a publicity campaign to reassure holidaymakers in a bid to get revenues back on track.