Thomas Cook collapsed on Monday after it failed to secure $250 million in rescue funding, stranding thousands of holidaymakers around the globe.
In a statement, the British travel operator said its board "concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect".
The UK government said it had hired planes to fly home an estimated 150,000 holidaymakers to the UK, in an operation starting on Monday.
"All customers currently abroad with Thomas Cook who are booked to return to the UK over the next two weeks will be brought home as close as possible to their booked return date," a separate statement said, describing it as the largest repatriation in peacetime history.
The firm ran hotels, resorts and airlines for 19 million people a year in 16 countries.

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