30th Oct 2020 09:17
(Alliance News) - Anglo-German travel and tourism company Tui AG on Friday said it has signed a USD90 million sale and leaseback agreement with BOC Aviation Ltd for two new Boeing 737 MAX-8 aircraft.
The two new aircraft are expected to be delivered during the coming winter, in line with Tui's newly agreed deferred re-fleeting programme with Boeing Co, once regulatory recertification of the Boeing 737 MAX-8 has been achieved.
This new lease agreement with BOC Aviation Ltd is expected to be on standard commercial terms and will create a total lifetime lease obligation for Tui of around EUR88 million to commence by the end of 2021, the company said.
Tui has been hammered by restrictions across the world due to Covid-19 and has embarked on a restructuring program to achieve an "optimal" balance sheet structure.
In September, the tour operator had announced plans to reduce overhead costs by 30% across the entire company, potentially cutting 8,000 jobs. It is targeting permanent annual savings of more than EUR300 million, with the first benefits expected to be delivered from the year ending September 30 and full benefits to be delivered by financial 2023.
Tui has reduced its capacity for the fourth quarter to 25% from 30% and is focussing on low-risk destinations, enabling customers to continue their holidays as planned.
Shares in Tui were up 0.9% at 293.50 pence each in London on Friday morning.
By Tapan Panchal; [email protected]
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