The British Airline Pilots Association (BALPA) on Friday called on the UK government to intervene and prevent the collapse of Thomas Cook Group, which urgently needs £200 million ($250 million) in order to safeguard a £900 million recapitalization deal and its survival. If the integrated travel group cannot secure the additional funding and files for bankruptcy, which according to UK media could happen in a matter of days, it could trigger one of the largest airline failures in Europe. Thomas Cook Group owns airlines in its three main source markets in Germany, the UK, and Scandinavia—Condor, Thomas Cook Airlines UK, and Thomas Cook Airlines Scandinavia—as well as Thomas Cook Airlines Balearics, based in Majorca, Spain. As part of its ongoing restructuring and to raise cash, it put its airline division up for sale earlier this year, though so far without success. 

The Department for Transport and the Civil Aviation Authority (CAA) reportedly have made initial preparations to bring stranded passengers back to the UK, under a plan known as Operation Matterhorn.

In a stock exchange announcement on Friday, Thomas Cook Group said talks to agree on final terms on the recapitalization and reorganization are “continuing” with its banks, bondholders, and largest shareholder, China’s Fosun Tourism Group. The discussions include “a recent request for a seasonal standby facility of £200 million, on top of the previously announced £900 million injection of new capital. The recapitalization is expected to result in existing shareholders' interests being significantly diluted,” it said, warning of a “significant risk of no recovery.” The company reported a loss before tax of £1.46 billion for the six months ending March 31 on revenue of £3 billion, deepened from a £303 million loss in the same period a year earlier.

Under the terms of the provisional rescue deal, Fosun will contribute £450 million of fresh capital and acquire at least 75 percent of the equity of the tour operator and 25 percent of the airline division, which would get spun off as a separate entity. To maintain their rights as EU airlines, they must be majority-owned and effectively controlled by European Economic Area interests. The group’s core lending banks and noteholders committed to converting their existing debt into approximately 75 percent of the equity of the airline and up to 25 percent of the tour operator. It aimed for the implementation of the recapitalization in early October.

In a last-minute addition, Thomas Cook’s lending banks, led by RBS and Lloyds, demanded an additional £200 million standby facility, a move that BALPA secretary general Brian Strutton described as “appalling” because both banks received taxpayer bailouts during the financial crisis. “It is appalling that banks that owe their very existence to handouts from the British taxpayer show no allegiance to a great British company,” noted Strutton. “The government has a say in this, owning one of the key banks [RBS] and still with huge influence over the other. RBS and Lloyds should be told by the prime minister to support Thomas Cook.”

Thomas Cook has filed for Chapter 15 bankruptcy protection in the U.S. to protect itself against legal action by U.S. debtholders, Bloomberg reported. It filed the petition on September 16.