27th Mar 2020 17:01
(Alliance News) - TUI AG on Friday said the German government has committed to supplying it a EUR1.8 billion loan which will force the travel company to waive future dividend payments.
The FTSE 250-listed Anglo-German holiday firm said the loan will be supplied by state-owned bank KfW.
TUI added: "The KfW loan is subject to the approval of the banking consortium in regards to the necessary amendments of the revolving credit facility. Thereby, TUI would have currently cash and available facilities of EUR3.1 billion. TUI decided to apply for the KfW loan to soften the unprecedented effects of the Covid 19 pandemic until normal business operations can be resumed.
"One of the conditions of the KfW loan is that TUI de facto waives dividend payments for the term of the credit line."
TUI shares closed 9.1% lower at 367.80 pence each in London on Friday.
By Eric Cunha; [email protected]
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