The cash-strapped UK parent of Thomas Cook has decided to sell its Indian arm to raise money to bolster troubled global operations after heavy debt and writedown pushed the world's oldest travel firm to the brink of collapse last year.

Royal Bank of Scotland will find a buyer for Thomas Cook India after the two foreign promoters pledged their entire holding in the Indian arm with the British bank on Wednesday. 

Shares in Thomas Cook India rose more than 2 per cent on Thursday after the report. At 10:27 a.m. shares in Thomas Cook India were up 1.99 per cent at Rs 33.30 in a weak Mumbai market as per a report in ET by Manisha Singhal.

While Thomas Cook UK Ltd holds 21.39% in Thomas Cook India (TCIM) has 11.81 crore shares, or 55.72% stake. Small investors hold about 15.61% in the company, according to information filed with the stock exchanges.

Thomas Cook India Managing Director Madhavan Menon said the talk of selling India business was just speculation and that the company would not like to comment.

Thomas Cook UK is struggling to stay afloat after suffering a 573-million writedown due to downturn in its businesses in the UK, Canada and Europe last year.

In November, it managed to arrange a 200-million revolving credit facility from banks after a spate of cancellations spurred by unrest in North Africa and floods in Thailand squeezed cash flows.

The firm is estimated to have net debt of 900 million. This new facility is to be in place only till April and Thomas Cook has been trying to dispose of hotels and aircraft to raise cash. 

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