Tui sells Spanish JV stake to cut real estate exposure
TUI AG Reg Shs (Post- 16/12/14)(DI)
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Tui has agreed to sell its 49% stake in Spain's Riu hotels to its joint venture partner Riu-Group for an initial payment of €540m (£464m) in cash to reduce debt and exposure to real estate.
Travel & Leisure
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Tui AG
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Tui will receive up to €130m more depending on the business's performance over two years. The world's biggest travel tour operator said the deal gave the operation, which has 21 hotels, an enterprise value of €1.5bn.
The FTSE 250 group said it would continue its 50:50 joint venture with Riu covering 100 hotels and resorts around the world. It will use the money to reduce debt, which soared during the Covid-19 crisis.
Tui said the deal was part of its strategy of concentrating on brands and service while tying up less capital in real estate.
"Tui is strengthening its core business with holiday experiences - and in particular the development, operation and marketing of hotel and holiday brands," the company said.
Shares of Tui rose 0.6% to 435.2p at 09:28 BST.