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Tui secures funding package amid continuing ‘volatility’
Tui has secured a €1.8 billion funding package as it seeks to weather the pandemic storm until travel begins to resume.
The German operator said it needed the cash injection following increased restrictions placed on travel.
It will ‘bridge the gap’ if the pandemic persists in 2021 and ‘provide sufficient liquidity reserves in this volatile market environment’, Tui said.
"It also balances out the presumed travel restrictions until the beginning of the 2021 summer season," the company said in a statement. "The package became necessary due to the increasing travel restrictions caused by the rising number of infections and the associated more short-term booking behaviour of some customers."
More positively, Tui added that the imminent availability of Covid vaccines will significantly reduce travel restrictions, and further improve its working capital and liquidity.
"Holidays continue to be a high priority for our customers, and we continue to work on different demand scenarios for the coming seasons," it said.
Tui Chief Executive Fritz Joussen said: "Before the Corona Pandemic, TUI was a very healthy company. The market is intact, the demand is there. But we have not been able to generate any significant revenues since March.
"Our integrated business model allows us to react very flexibly to short-term changes in the pandemic situation, just as we successfully ramped up our travel programme for a few weeks in July after the first wave.
"People want to travel, tourism remains a growth industry and an important sector for stabilising the southern euro area.
"The financial package provides the security to look consistently ahead and to prepare the Group strategically and structurally for the time after the pandemic."
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