Creditor claims could top £10 billion, Thomas Cook bosses were reportedly warned ahead of its collapse as a complex network of off-balance-sheet guarantees unwound.
A confidential report, prepared days before the failure, detailed how an insolvency would impact the travel sector, leaving huge debts owed to hoteliers, intermediaries and other suppliers.
The report, seen by The Daily Telegraph, found that many suppliers could expect to recoup just 3.4p in every pound owed to them.
Bondholders, whose debts totalled more than £1 billion, may only recover 2.3p.
The Thomas Cook brand was worth as little as £1.3 million, the report by advisers AlixPartners dislcosed. AlixPartners is now handling the liquidation of the company alongside KPMG.
Germany, Spain and Portugal have injected €830 million (£740 million) in loans and bailouts to prop up Thomas Cook subsidiaries and protect against contagion.
This is on top of the UK costs to fly customers home and fund redundancy pay – already estimated at £160 million.
The claims in the report differ to debts disclosed upon collapse of £3.1 billion because of the triggering of multiple guarantees.
The analysis revealed what can be realised from Thomas Cook. Other than cash, its assets were only worth £59 million – from a company that had a stock market value of more than £2 billion 18 months ago.
The sale of airport take-off and landing slots “is likely to be highly contentious in all jurisdictions”, the analysis found. Slots outside the UK were deemed worthless.
And there would only be a “short period” during which value can be realised from those at UK airports. Thomas Cook had around 200 slots at Gatwick and 350 at Manchester.
Air France KLM has emerged as the latest interested group, alongside other potential suitors such as British Airways owner International Airlines Group, easyJet and Virgin Atlantic.
Ministers have been criticised by unions for rejecting a plea to plug a £200 million shortfall in Thomas Cook’s rescue plan in late September.
A Department for Transport spokesman defended the government’s decision not to step in, saying: “Unfortunately airlines and tour operators do fail. It is not the government’s role to prop them up, and any financial assistance risks setting a precedent.
“We believe anyone looking at the details of this collapse will conclude a rescue deal would have been a poor use of taxpayer money, with no guarantee the company would have remained solvent.”
A spokesman for the official receiver said: “The official receiver as liquidator will look at the conduct of the directors and the affairs of the company during his investigations into the failure of the company.”
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