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China's Fosun in talks to inject £750m into Britain's Thomas Cook
[BENGALURU] China's Fosun Tourism Group said on Friday it is in advanced talks with Thomas Cook Group's lending banks to inject £750 million (S$1.28 billion) into the London-listed travel operator.
Under consideration is a capital injection and new financing facilities, Fosun Tourism said in a filing to the Hong Kong stock exchange.
Fosun said the recapitalisation would entail a reshuffle of the ownership of Thomas Cook's tour operator and airline business, resulting in the Chinese firm owning a controlling stake in Thomas Cook's tour operator and a significant minority interest in Thomas Cook Airlines.
The development comes after Sky News reported on Thursday that Thomas Cook Group was in advanced talks about a deal with Fosun and its lenders to recapitalise its tour operating business.
The report cited bankers as saying a proposed deal involved Fosun and Thomas Cook's lenders injecting hundreds of millions of pounds worth of new equity into the British company.
That report came a month after Thomas Cook said it was in talks with Fosun, its largest shareholder, over the sale of its tour operating business after the Chinese firm made a preliminary approach.
Thomas Cook said it had no comment on the Sky News report.
Fosun on Friday said its proposal envisages a significant amount of Thomas Cook's external bank and bond debt will be converted into equity, and that existing Thomas Cook shareholders will have their stakes significantly diluted as a result of the recapitalisation.
The proposal is subject to due diligence and further discussion, among other things, Fosun said.