TUI Says It Will Maintain Majority Shareholding in TUI TravelRichard Weiss
TUI AG, Europe’s largest tour operator, said it has no plans to reduce its stake in TUI Travel Plc and will continue to exercise its role as majority shareholder.
TUI commented in an e-mail today after Manager Magazin reported that it was considering a sale of the stake in what would be a “radical new start´´ for the Hanover-based company, after a struggle for more power over the U.K. unit. TUI owns more than 56 percent of TUI Travel, according to data compiled by Bloomberg.
TUI Travel, based in Crawley, England, has a market value of 3.54 billion pounds ($5.3 billion), meaning the stake owned by TUI is worth about $3 billion, more than the entire market value of the holding company at about 2.1 billion euros ($2.7 billion). The parent also owns hotels and cruise ships.
TUI Chief Executive Officer Friedrich Joussen took over from Michael Frenzel, who had headed the company for 19 years, on Feb. 13. Joussen told shareholders on that day that he had scrutinized the company’s tour operations, airlines, hotels and cruises businesses, and he reiterated a commitment to sell its remaining stake in Hapag-Lloyd AG, Europe’s fourth-largest container line.
TUI has generated losses in three of the past six fiscal years, partly blaming profits it has to distribute to minority shareholders. The company on Feb. 13 reported its biggest first-quarter loss in four years, and Joussen said he had “no patience´´ if a part of the company didn’t deliver the right performance.
The company on Jan. 23 said it dropped a plan to merge with TUI Travel after investors opposed the deal.
TUI fell 0.3 percent to 8.18 euros at 1:47 p.m. in Frankfurt, and has climbed 4.2 percent this year. TUI Travel dropped 1.1 percent, paring its advance to 12 percent since the end of December.