The bankruptcy petition filed earlier today, Monday, is causing strong turbulence in the European tourism market of the tourist group FTI, following the failure of negotiations her administration had with the German government. THE bankruptcy of the German giant, the third largest travel provider in Europes affecting 11,000 workers, but also tens of thousands of travelerswho are either currently on vacation or had already booked packages for the near future.

Workers were informed in the morning about the development by video conference, but reservation systems were already down, supposedly due to a technical problem. The website of the Labranda hotel chain, which belongs to FTI, was also disabled since the morning.

According to information from BILD, the management of FTI was throughout the weekend in negotiations with the Ministries of Economy and Finance, with the aim of covering the financial gap of double digit number of millions, in order to spend the summer. The federal government finally rejected the company’s request yesterday, Sunday evening.

Munich-based FTI was already facing problems before the coronavirus pandemic, and had managed to survive with only €595 million from the government’s Economic Stabilization Fund (WSF) and an additional €280 million received from UniCredit, which was guaranteed by the federal government and the state of Bavaria. In April, the rescue of the company still seemed possible, as the American investment company Centares had announced that it would buy it, assuming its debt, amounting to one billion euros and having an additional 125 million euros available in new chapters. The process was delayed because the Federal Office for Cartels was not going to approve the purchase until August or September at the earliest, so FTI needed funds to see it through the summer.

The company announced that efforts are being made so that those who are already on vacation can complete them normally and return without a problem, while the Travel Insurance Fund will undertake to refund deposits for packages that are ultimately cancelled. The Fund was established in 2019, after the bankruptcy of the Group Thomas Cook. The FTI group said it was working to ensure that journeys that had already started completed as planned, but “journeys that have not yet started are likely to be no longer possible or only partially possible from Tuesday”.

What does the suspension of the third largest tourist agency in Europe mean for Crete – What the president of the Association of Tourist and Travel Agencies of Crete told skai.gr

There are many businessmen of Crete who have to receive money as balances from last year from this particular tourist agency, while even now there are visitors to the island who come to Crete through this tourist “colossus” of Europe. It is reasonable to worry the tourist family of the island who sees problems being caused with good morning, in a season that creates expectations.

Hotel Association of Crete at skai.gr: The number of tourists who booked holidays through FTI is still unknown

In shock are the hoteliers of Crete from the “cannon” of FTI, the third largest tourist agency in Europe.

Speaking to skai.gr, the president of the Hotel Association of Crete, Nikos Chalkiadiakis, stated that the number of Germans, mainly tourists, who had booked their holidays on the island has not yet been known.

“We are waiting for the information from the competent law office” he emphasized, while appearing reassuring, since as he said there is no problem with the hotels as the reservations are prepaid and their trip is insured.

Mr. Chalkiadakis also emphasized that the bankruptcy drags along all group offices such as You Travel based in London, through which thousands of Britons had booked their holidays.

The FTI Group announcement

FTI announced that:

  • FTI Touristik GmbH files for insolvency on Monday, June 3, 2024
  • Other Group companies will also file for insolvency in the coming days
  • A hotline for direct contact and a website with frequently asked questions has been set up for all customers of the travel agent group

The official announcement states:

  • FTI Touristik GmbH, the parent company of the FTI GROUP which is the third largest travel operator in Europe, will file for the initiation of insolvency proceedings at the Munich Regional Court on Monday, June 3, 2024.
  • Initially, only the travel agent brand FTI Touristik is directly affected by this.
  • Subsequently, however, corresponding applications will be submitted for other companies of the Group.
  • Windrose Finest Travel GmbH with the luxury brand WINDROSE will continue its activities.
  • The independent companies Euvia GmbH and the travel shopping channel of sonnenklar.TV as well as the franchise system of Touristik Vertriebsgesellschaft mbH (TVG) with the brands sonnenklar.TV Reisebüros, 5vorFlug Reisebüros and Flugbörse do not belong to the FTI Group.
  • After a long and complex investment process, the entrance of a consortium of investors announced in April 2024. Since then, however, bookings figures are well below expectations despite the positive news. In addition, many suppliers insisted on advance payment. As a result, there was an increased need for liquidity, which could no longer be bridged until the closing of the investment process. Therefore, the bankruptcy petition became necessary for legal reasons.

Information for FTI GROUP customers

Supporting travelers affected by the consequences of insolvency, as reported, is now a top priority for FTI GROUP. A support site has already been created at the address www.fti-group.com/en/ insolvency as well as a telephone support line at +49 (0) 89 / 710 45 14 98.

In addition to fully focusing on customer support, FTI GROUP will also regularly inform its visitors together with the German Travel Security Fund (DRSF).

The announcement concludes:

“We are currently working hard to ensure that journeys that have already started can be completed as planned. Journeys that have not yet started will likely no longer be possible or only partially possible from Tuesday 4 June 2024. In partnership with the (interim) insolvency practitioner yet to be appointed, a continuous update of affected travelers will be sought.”