No UK government ministers were in direct contact with Thomas Cook in the six days before its collapse, the company’s boss has told MPs.
Peter Fankhauser said it was only in an “awfully sad” phone call with an official from the Department for Transport, hours before the liquidation, that he learned that the government had refused to provide a £200m lifeline to the 178-year-old firm.
He added that there had been no contact at all from the Department for Business, Energy and Industrial Strategy (BEIS) – and that meanwhile ministers from five other countries had been in touch.
The company had been battling to put together a refinancing deal involving Chinese conglomerate Fosun and other investors ahead of its collapse last month.
By the weekend before it went into liquidation – with the business “on its knees” – it had become clear that a “last resort” backstop to be provided by the government would be needed to secure the funding.
But on the Sunday afternoon, Mr Fankhauser learned that this had been refused.
He told the business select committee: “I was awfully sad when I had the high official on the phone about five o’clock in the evening, because I knew, now I have to throw in the towel.”
Mr Fankhauser told the Commons business select committee he had worked “extremely hard” to try to save the company.
But he said he had been hamstrung by the company’s debt pile as he tried to turn around its fortunes – and its prospects were then further damaged by the heatwave summer that dented bookings last year.
As the date of the collapse approached, Mr Fankhauser had been personally contacted by ministers from the German, Spanish, Bulgarian, Turkish and Greek governments – but none from Britain.
He added that the company had told the government – via civil servants – that the cost of Thomas Cook’s collapse to taxpayers would have been “far higher” than the level of funding it was asking for to stay afloat.
Mr Fankhauser expressed his frustration that, had the recapitalisation succeeded – trimming the company’s debts and giving it enough cash to survive through the lean winter months – he believed it could have thrived and “probably would have been the best funded travel company in Europe”.
Former Thomas Cook employees, some of them wearing their old uniforms, sat behind Mr Fankhauser and other former senior management as they gave evidence to the committee.
MPs rounded on the witnesses over the “rewards for failure” that executives had been paid.
Pressed on his bonuses, Mr Fankhauser said he had received a £750,000 pay-out in 2017 – partly in shares that are now worthless – but none in 2018 and 2019.
He said he had worked “exhaustively and extremely hard” for the millions of pounds he had been paid to lead the company since 2014 but that he would now consider calls to pay back some of the money.
Mr Fankhauser said: “I am deeply sorry about this failure and I am deeply sorry at the distress caused to millions of customers who booked holidays with us.”
He added: “I put massive, massive work into saving the company and I have to admit I failed.”
Mr Fankhauser said that since taking over in 2014 he had been working on “transforming this business from an old-fashioned tour operator to a modern tour operator”.
But he added: “The pace was not fast enough. It was constrained by this huge debt pile.”
He said that since 2012, Thomas Cook had spent £1.2bn on interest and refinancing costs.
“Imagine if we could reinvest in the business only half of that, we could have been faster.”
The collapse of the 178-year-old company last month put 9,000 UK jobs at risk.
It also triggered the largest-ever peacetime repatriation of British citizens, with more than 150,000 holidaymakers flown back to the UK during a two-week operation run by the Civil Aviation Authority.
Last week, family-owned Hays Travel bought Thomas Cook’s network of UK retail stores for an undisclosed sum in a deal that could salvage as many as 2,500 jobs.