Thomas Cook, the British travel concern, failed to place a $50m Islamic aircraft finance bond with investors, highlighting that the market for debt that complies with Muslim law has yet to recover fully from a rash of defaults over the past two years.

The planned Islamic bond, properly called sukuk, was to have been the first such corporate issuance out of Europe.

The failure of Thomas Cook’s sukuk offering suggests that demand for sukuk remains limited to mostly highly rated debt, even among cash-rich Shariah-Compliant banks in the Gulf area. Thomas Cook declined to comment to inquiries from Financial Times. Financial Times indicated that a person familiar with the issue said it was the company’s decision not to proceed, but the person did not offer a reason.


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