Travel group TUI strikes deal on third bailout package

FRANKFURT (Reuters) – TUI struck a deal on Wednesday on a third bailout package as the world’s largest holiday company secured help to ride out the coronavirus-linked travel slump.

FILE PHOTO: Outbreak of the coronavirus disease (COVID-19) in Stoke-on-Trent

TUI said it has reached an agreement with private investors, banks and the German federal government on an additional financing package worth 1.8 billion euros (1.6 billion pounds). The company received 3 billion in state loans in two tranches earlier this year.

The new rescue package includes a 500 million euros capital increase with subscription rights and a 420 million euro convertible silent participation supplied by Germany’s economic support fund WSF.

The package also includes a non-convertible equity hybrid or silent participation by the WSF of 280 million euros, a state guarantee of 400 million euros, an additional credit facility by state bank KfW of 200 million as well as a prolongation of an existing credit facility by KfW until July 2022.

© Reuters/PHIL NOBLE
FILE PHOTO: People wear face coverings as they stand outside a Tui travel agents shop following the outbreak of the coronavirus disease (COVID-19) in Chester, Britain

(Reporting by Arno Schuetze, editing by Emma Thomasson)

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