Travel industry - Tour operators gain advantage as FTI goes bankrupt.
According to tourism expert Torsten Kirstges, the travel industry is still thriving even though FTI Group is facing insolvency. While the Corona crisis has left some businesses with significant debt and bank loans, people are still traveling, and high-priced trips and cruises are on the rise.
Kirstges, a professor at the University of Jade in Wilhelmshaven, believes that other travel organizers may profit from FTI's bankruptcy. "Despite the FTI insolvency, people will continue to travel," he predicts. "The cake worth billions of dollars will simply be divided among other organizers. There won't be any noticeable disruption in the overall number of trips by next year."
FTI Group has been struggling financially for some time, with a weak balance sheet in 2022, among other issues. The travel restrictions during the pandemic further exacerbated the company's situation. FTI was considered less profitable and had a low equity capital. The company relied on state aid during the pandemic, which they now have to repay.
Instead of accepting the offer of fresh capital from a consortium, FTI filed for insolvency at the Munich District Court. The consortium, led by US financial investor Certares, wanted to purchase the FTI Group for one euro and inject 125 million euros into the company. However, this deal needed approval from the antitrust authorities.
Reports suggest that FTI's booking figures have been disappointing recently. "In addition," the company said, "many suppliers were demanding advance payments, which increased liquidity requirements and couldn't be covered until the investor process was closed."
