2nd Dec 2020 15:18
(Alliance News) - Tui AG on Wednesday said it has reached an agreement for a EUR1.8 billion support package, shoring up its finances further in the face of the Covid-19 pandemic.
The package includes of a EUR500 million capital raise and a EUR200 million additional facility from the KfW, Germany state-owned development bank.
The financing also includes a EUR700 million package from Germany's Economic Stabilization Fund, of which, EUR420 million is converted into Tui shares at EUR1.00 each.
The package also includes a EUR400 million state guarantee, or an increase of the Economic Stabilization Fund's non-convertible financing.
"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.
It's the third financial aid package Tui has received in the wake of the Covid-19 pandemic.
In April, Tui secured EUR1.8 billion financing from the KfW, before agreeing to a further EUR1.05 billion in October.
Tui shares were 3.0% lower at 495.94 pence each in London on Wednesday afternoon.
By Eric Cunha; [email protected]
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