When the travel business came to a standstill in 2020 as a result of the corona pandemic, the state provided TUI with a total of 4.3 billion euros. Now is the right time for a quick repayment, says CEO Ebel. However, the prerequisites for a further capital increase must first be created.
TUI wants to repay the remaining state aid from the Corona crisis by the end of next year. According to the agreed plan, the travel group is replacing the remaining silent participation of the federal government and a bond with warrants for at least 730 million euros and is buying the right to conversion into TUI shares from the state corona rescue fund. TUI wants to raise the money for this with another capital increase, as the company announced on Tuesday evening in Hanover.
In addition, the loans from the state bank KfW could be significantly reduced from the last 2.1 billion euros. “Rapid return of state aid was always our goal,” said TUI boss Sebastian Ebel. “Now is the right time for it. TUI is stable again and on the way back to profitable growth.”
The travel business recovered strongly in the summer of 2022. The group “of course still has a challenging path ahead of it,” said Ebel. “But our strategy, our future-proof business model, the restart of tourism and promising customer and travel trends make us confident about our path back to normal.”
In 2020, the German state supported TUI with a total of 4.3 billion euros due to the collapse of the travel business in order to prevent bankruptcy. Of this, EUR 3 billion was accounted for by KfW loans and EUR 1.3 billion by equity in the form of silent participations. In order to repay them, TUI has raised fresh capital three times in the past year and a half, totaling more than two billion euros. This has diluted the share price so much that the tourism group has to reduce the share capital to a tenth before further capital increases. This is to be decided at the Annual General Meeting in February 2023.
Ten TUI shares become one, out of a total of 1.785 billion shares, 179 million. That makes capital increases “at normal market conditions” possible, explained TUI. Because new shares may not be issued below the calculated nominal value of 1.00 euros. TUI already has the stockholders’ approval for the planned capital increases with subscription rights. The state will waive the conversion right for its silent participation until the end of 2023.
On Tuesday, TUI papers in Xetra trading closed at 1.72 euros. The TUI supervisory board has already approved the schedule for the repayment. The German state is currently still committed to TUI with a contribution of 420 million euros and a bond with warrants for 59 million euros. Including interest and compensation for the stock options, the travel group has to pay significantly more to the WSF. He had already repaid 671 million euros in the summer.
