TUI sells Hapag-Lloyd to joint venture for €1.2bn
TUI AG Reg Shs (Post- 16/12/14)(DI)
1,114.00p
17:00 10/02/15
TUI has agreed to sell its Hapag-Lloyd Cruises business to TUI Cruises, the company's 50:50 joint venture with Royal Caribbean Cruises, for an enterprise value of €1.2bn (£1bn).
Travel & Leisure
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16:59 10/01/25
The travel company said the sale price had a net cash element of about €700m including a €63m earn-out if Hapag-Lloyd meets its earnings target. TUI said the sale would generate a considerable book gain.
TUI said it had agreed with Royal Caribbean to expand their partnership for luxury and expedition cruises. Hapag-Lloyd sells cruises in German-speaking markets and has two five-star luxury ships and three expedition ships.
The FTSE 100 company said the sale was in line with its goal of increasing profit while freeing capital. TUI has been hit by consumer wariness, Boeing 737 Max groundings and airline overcapacity, forcing it to issue profit warnings in 2019.
TUI said: "The partnership combines the shipbuilding, operational and digital expertise of Royal Caribbean and the strong brand and distribution power of TUI … In light of the transaction it is anticipated the luxury and expedition fleet will grow in the coming years, as it is expected that the demand for luxury and expedition cruises will continue to grow."