The third-largest travel agency in Europe, the German FTI, filed for bankruptcy today in the Munich regional court, potentially affecting thousands of vacationers at the beginning of the summer season.
FTI employs 11,000 people worldwide and offers trips to more than 40 destinations around the world, including Greece.
“At the moment, we are working hard to ensure that the trips that have already started can be completed as planned,” the company stated. Trips that have not yet started will likely not be able to take place, or only partially, starting from tomorrow, Tuesday.
The rescue attempt failed
Employees were informed of the development this morning via a teleconference, but the reservation systems were already offline, supposedly due to a technical issue. Labranda hotel chain’s website, which is owned by FTI, has been down since the morning.
According to BILD sources, FTI management was in negotiations with the Ministries of Economy and Finance over the weekend, aiming to cover a double-digit million financial gap to get through the summer. The federal government ultimately rejected the company’s request last night, Sunday.
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FTI, based in Munich, was already facing problems before the COVID-19 pandemic and had managed to survive with only €595 million from the government’s Economic Stabilization Fund (WSF) and an additional €280 million from UniCredit, guaranteed by the federal government and the state of Bavaria. In April, the company’s rescue still seemed feasible as the American investment firm Centares had announced its intention to buy it, assuming its debt of €1 billion and providing an additional €125 million in new capital. The process was delayed because the Federal Cartel Office was set to approve the acquisition no earlier than August or September, so FTI needed capital to get through the summer.
The company announced efforts to ensure that those already on vacation can complete them normally and return without any issues, while the Travel Insurance Fund will reimburse deposits for packages that will ultimately be canceled. The Fund was established in 2019 after the collapse of the Thomas Cook Group.