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(Alliance News) - Tui AG on Friday said it has launched a EUR1.8 billion capital raise to repay German state aid it received at the start of the Covid pandemic.
The Hanover, Germany-based holiday operator said it will offer 328.9 million new shares at a subscription rate of 8 new shares for each 3 existing shares. The subscription price of EUR5.55 per new share represents a discount to the theoretical ex-rights price of around 40%, it noted.
TUI shares were down 6.8% to EUR14.80 each in Frankfurt on Friday morning. They were down 8.1% at 1,299.50 pence in London.
The company said it plans to repay outstanding EUR420.0 million of state aid, convertible Silent Participation I, and EUR58.7 million 2020/2026 bonds with warrants, including accrued interest at a total market value of around EUR750 million.
Tui explained that, with remaining net proceeds of around EUR568 million, the current drawings under a EUR1.45 billion cash facility will be reduced to about EUR870 million. Further, it intends to reduce the EUR2.1 billion credit line under a KfW facility to EUR1.1 billion. KfW is a German-state owned investment and development bank.
Looking ahead, Tui noted that the "encouraging booking momentum" it reported with its first-quarter results in February was continuing.
By Tom Budszus, Alliance News reporter
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