TUI AG agreed to sell its Hotelbeds unit to funds of buyout firm Cinven Ltd. and the Canada Pension Plan Investment Board for 1.19 billion euros ($1.3 billion) as Europe’s largest travel services company seeks to improve its finances and expand in non-tourism businesses.

Proceeds from the sale of the online hotel-booking business will be used to invest in future growth opportunities and strengthen TUI’s balance sheet, the Hannover, Germany-based company said in a statement Thursday. The transaction is still subject to regulatory approval and expected to be completed by the end of September.

Chief Executive Officer Friedrich Joussen is cutting back online activities to drive annual operating profit, which fell in the year ended September 2015. Cinven and Canada Pension are paying about 1.2 times 2015 revenue for Hotelbeds, which had underlying pre-tax profit of 69 million euros last year, according to the statement.

TUI shares rose 1.7 percent to 1,023 pence in London trading Wednesday after earlier rising as much as 2.3 percent.

Hotelbeds offers rooms to online and traditional travel agencies and airlines with a database of beds at more than 72,000 hotels worldwide, plus transfers and tours.

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This article was written by Dave McCombs and Crayton Harrison from Bloomberg and was legally licensed through the NewsCred publisher network.

Photo Credit: TUI has sold its Hotelbeds business for $1.3 billion. Hotelbeds