TUI AG, the German travel company that is a significant participant in the cruise industry, said it has reached an agreement with private investors, banks and the German federal government on additional financing package of €1.8 billion.

This includes e.g. an approx. €500 million capital increase with subscription rights and a €420 million convertible silent participation by the Economic Support Fund of the German government plus an additional credit facility by KfW of € 200m, and a prolongation of an existing credit facility by KfW until July 2022.

TUI owns 50% of TUI Cruises, which operates a cruise brand of the same name plus luxury and expedition market focused Hapag-Lloyd Kreuzfahrten, TUI is 100% owner of Marella Cruises in the UK.

“The financing package strengthens TUI's position and provides it with sufficient liquidity reserves in this volatile market environment. It also balances out the presumed travel restrictions until the beginning of the 2021 summer season. The package became necessary due to the increasing travel restrictions caused by the rising number of infections and the associated more short-term booking behaviour of some customers,” the company said in a statement.

The package also provides for a reduction of TUI’s share capital from € 2.56 per share to € 1.00 per share -without merging shares- followed by a capital increase by means of a rights issue of approx. 509 million shares. As TUI's largest single shareholder, holding approx. 24.89 % of the shares, Unifirm Ltd. has irrevocably committed to exercise its subscription rights in this capital increase.

“Including the financing package now agreed, as of 30 November 2020 TUI has pro forma financial resources and credit facilities of € 2.5 billion post € 300m Senior Notes redemption,” the company said.

Photo: Marella Discovery in Aqaba, Jordan