Thomas Cook Group has agreed that China-based Fosun Tourism Group, already its largest shareholder, will acquire 75% of the tour-operator business and 25% of the airlines unit in return for a capital injection.
Fosun will contribute £450 million ($546 million) of new money into the group, while other lenders will contribute a further £450 million to acquire the remaining parts of the business – 25% of the tour operator and 75% of the airlines.
Existing shareholders' interests are to be "significantly diluted" by the recapitalisation plan, says Thomas Cook. The group may also be delisted from the London Stock Exchange.
The deal is subject to credit and investment approvals, performance conditions, and due diligence, as well as agreement with existing stakeholders.
Thomas Cook has been engaged in months of negotiations with its backers to enable it to continue trading through the soft winter period and into the summer 2020 season.
Earlier this year, the leisure group disclosed an intention to divest its airline division, which includes operations in Denmark, Germany and the UK.
Cirium fleets data shows that Thomas Cook Airlines has a 48-strong all-Airbus fleet, mostly A321s, and no new aircraft on order.