Originally Posted by
RudderTrimZero
Can someone here explain what a £1.25 billion "write-down" is? What exactly does it mean and what does "good-will" have to do with it?
Seems like a massive
PR disaster to even discuss their own debt like this. Customer confidence will be so negative now. This alone is likely to destroy the company, forget the debt.
As I understand it, when TC bought MyTravel, they considered it had a capital value of £x billion. They now believe it is worth £1.5 billion less. This is important because the capital value of a company's assets have to be set against its liabilities or debts, and TC has huge debts.
As for "goodwill" if a company buys another, part of the price will be the physical assets, bank balance etc, and its existing order book, but some will be the good name of the business, its contacts, and so on.
That's how I understand it, but I'm not an economist or accountant.