TUI Travel and TUI will merge to create the world number one

TRAVEL AGENCIES - TUI and its British subsidiary TUI Travel announced they will merge to create the world's number one industry. The German tourism group confirms a project unveiled in June

 
The new group, which will retain the name of the German (TUI AG), will be based in Germany and will weigh the equivalent of 6.5 billion euros (7.9 billion) stock market. It will be primarily listed on the London Stock Exchange and secondarily on the German market.

Under the terms of the agreement, shareholders of TUI Travel will receive 0.399 share of the new TUI AG for each of their shares. In the end, the shareholders of TUI Travel should hold 46% of the new group and those of the current TUI AG 54%.


TUI Travel shareholders will receive a dividend of 20.5 pence again for each of their shares under the 2013/2014 financial year.

Taxes should be reduced

The largest shareholder of TUI AG, Alexey Mordashov, has agreed to the merger, which will allow the new group to accelerate its growth, ensured both partners. They hope to continue to grow, citing "the acquisition of 30 hotels and two additional cruise ships."

In addition to an expected improvement in profits from the operation of hotels and ships, the merged group could achieve savings of € 45 million per year. It also plans to cut taxes. If it had been established earlier, it would have saved eg 35 million euros in taxes in fiscal 2012/2013, he has put forward.

Job cuts not mentioned

Both groups said that "the new organization should be put in place by the end of the year." Once the merger is realized, the new TUI will have two CEOs: Friedrich Joussen, current CEO of TUI AG, and Peter Long, CEO of TUI Travel. Friedrich Joussen take only the general direction of the new group in February 2016 and Mr. Long will become chairman of its supervisory board.

Friedrich Joussen promised "a group of tourism worldwide leader and pioneer of innovation in our industry." He added that "74,000 employees in some 130 countries of the world will have new career opportunities," reminiscent of job cuts.

30 million customers

TUI AG currently operates 230 hotels and seven cruise ships, while TUI Travel has specialized in services of tour operator with a portfolio of 30 million customers.

The British branch, which oversees New Frontiers in particular France, was born in 2007 from the merger of TUI Tourism and First Choice UK. TUI AG currently holds approximately 56% of its capital.

The confirmation of this marriage was hailed on the market in mid-morning: at 10:50 TUI AG share price gained 0.91% to 11.11 euros on the Frankfurt Stock Exchange while TUI Travel climbed 1.91% to 367 pence the London Stock Exchange.
(ats / Newsnet)