XL Leisure group, the third largest tour operator in the UK, has collapsed and the ripple effect is spreading quickly, leaving the owners of West Ham United, among others, facing severe losses.
According to Morgunbladid, the connection between West Ham, XL Leisure Group, Landsbanki and Eimskip is great: for example West Ham is owned by Bjorgulfur Gudmundsson, XL Leisure Group was owned by Eimskip and the Icelandic bank Landsbanki, also controlled by Bjorgulfur Gudmundsson, were key investors in XL back in 2002 and is now in cooperation with Straumur Investment bank, owned by Gudmundsson’s son, Bjorgulfur Thor Bjorgulfsson, coming to the rescue by taking over a loan that Eimskip is still responsible for since selling XL Leisure Group back in October 2006.
Eimskip is an icon in the Icelandic business world and is one of Iceland’s oldest companies. The company’s share price went down by 21 percent on the OMX yesterday and its value has gone down by 77 percent since January 2008, Morgunbladid reports. Eimskip has been on the watch list at the OMX-NASDAQ Nordic Stock Exchange since earlier this month.
The XL Leisure collapse has a wide affect, as Eimskip stands to loose some 207 million euro, Straumur Investment bank could lose up to 45 million euro and the bank will be taking over XL operations in Germany and France, which are still considered profitable.
To get back on its feet Eimskip will have to sell Atlas Versacold, but that sale might not be a magic cure, as some say that Eimskip will be lucky to sell with out heavy losses, Morgunbladid reports.
Morgunbbladid also writes “It is important for Eimskip Share holders that they are kept informed on Bjorgulfur’s plans with the company and the deal they have made by overtaking the XL Leisure Group responsibilities. For example if the loan will be changed to shares at some point.”
Other holiday brands that are a part of the XL Leisure Group include Freedom Flights, Aspire Holidays and Medlife Hotels.