While the substantial assistance TUI received from German authorities helped the tour operator remain afloat during the pandemic, getting all that aid definitely didn't come cheap for the world's largest tour operator.
TUI has struck an agreement with the German government to repay at least 730 million euros ($775 million) of state aid that bailed out the German tourism group during the coronavirus pandemic.
Under the deal, TUI would fully repay the silent participation provided by the government’s Economic Stabilization Fund as well as a remaining warrant bond until the end of 2023, the company said in a statement on Tuesday.
In return, the travel group would receive back the option rights to TUI shares held by the WSF.
In addition, TUI intends to significantly reduce credit lines provided by state development bank KfW.
The repayments will be refinanced through capital increases, it added.
“TUI is stable again and on its way back to profitable growth,” said Chief Executive Sebastian Ebel, citing a strong summer business this year.
($1 = 0.9422 euros)
(Reporting by Ludwig Burger; Editing by David Goodman and Josie Kao)
This article was written by Ludwig Burger from Reuters and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to [email protected].
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Tags: bailouts, germany, tui, tui group
Photo credit: TUI is paying back the German government $775 million in state aid it received during the pandemic. Christoph Wilhelms / Wikimedia Commons