Thomas Cook Rescue to Be Challenged
- Funds group together to ensure their CDS trades pay out
- Traders face uncertainty due to detail in derivative contracts
Photographer: Mike Wilkinson/Bloomberg
This article is for subscribers only.
Holders of credit insurance on Thomas Cook Group Plc are drawing up plans to potentially block the U.K. travel agent’s $1.1 billion rescue in order to ensure they get a payout.
The group of hedge funds, including Sona Asset Management and XAIA Investment GmbH, may vote against a bailout led by Fosun Tourism Group at a creditor meeting on Sept. 18 if they don’t secure their payment before then, according to people familiar with the plan. Fosun’s rescue includes a debt-for-equity swap that could prevent compensation on their default insurance.