Thomas Cook (TCG.L), the world’s oldest travel firm, collapsed on Monday, stranding hundreds of thousands of holidaymakers around the globe and sparking the largest peacetime repatriation effort in British history.

Boris Johnson has pledged to help holidaymakers stranded by travel company Thomas Cook's closure, as he questioned whether bosses are not incentivised to prevent their business's demise.

The British Prime Minister was speaking before the announcement that the 178-year-old firm has ceased trading with immediate effect.

More than 150,000 British holidaymakers are currently abroad and will need to be repatriated, the Civil Aviation Authority said.

Mr Johnson told reporters on board the RAF Voyager travelling to New York for the United Nations General Assembly that his thoughts were with customers.

"It's a very difficult situation and obviously our thoughts are very much with the customers with Thomas Cook, the holiday makers, who may now face difficulties getting home."

Speaking before the collapse was announced in the early hours of Monday, the PM said "we will do our level best to get them (travellers) home".

"There will be plans ready to deal with that if it's necessary," he said.

"One way or the other the state will have to step in quite rightly to help stranded holidaymakers."

He said ways must be investigated so tour operators can protect themselves from bankruptcy, following the collapse of Thomas Cook as well as Monarch's demise in 2017.

"One is driven to reflect on whether the directors of these companies are properly incentivised to sort such matters out," he added.

The PM also sought to fend off criticism over the lack of a state bailout for Thomas Cook.

"It is perfectly true that a request was made to the government for a subvention of about £150 million," he said.

The UK Civil Aviation Authority (CAA) said it has launched Britain's largest peacetime repatriation to bring home stranded Thomas Cook passengers.