Thomas Cook CDS

All,

We have been oscillating over this issue when it emerged that the SoA would only be used to set the voting thresholds lower.

As per our initial deliberations, the CH15 filing by itself is too weak to trigger the CDS, the SoA on its own is not triggering a default and when all is done there won’t be a deliverable to settle.

However, after having given it some thought at the time, it occurred to us that if a 100% equitisation of £1bn+ for some 13p/£ in value do not trigger CDS, then the DC can “go home” - along with the entire corporate CDS market. It appears to us that the very existence of the DC is to put some substance over form.

As the case may be, we are now at the awaited crossroads: Unless some of our friends can block the vote (hold more than 25%), it's all eyes on the DC (who are probably hiding right now, hoping that the vote will take the decision off them).

Anyhow, the bonds are cheap enough. So unless we can see the bond price spike over the coming days, we assume the vote will be blocked or it won’t even come to that and some event will be somehow manufactured

Wolfgang