(Alliance News) - Tui AG on Thursday said it plans to raise nearly EUR550 million through a share issue, easing financial strain on the Anglo-German tour operator, who business has been devastated by travel restrictions to combat Covid-19.
Tui will raise EUR544.6 million through the issue of 509.0 million shares.
Shareholders would be offered 25 new shares for every 29 shares already owned, at a subscription price of EUR1.07, about 96 pence.
Tui shares were 18% lower at 400.28p each in London on Friday afternoon.
"The principal purpose of the offering is to repay indebtedness in order to improve the company's liquidity position," the company explained on Thursday.
On Tuesday, Tui shareholders voted to allow the German state to take a stake of up to 25% in the company.
The European Commission announced on Monday that EU competition watchdogs had approved the German state aid of up to EUR1.25 billion for Tui.
The state aid package comprises EUR420 million in silent participation, which can be converted into Tui's equity.
It also comprises non-convertible silent participation of up to EUR680 million, and EUR150 million of convertible warrant bond.
By Eric Cunha; firstname.lastname@example.org
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