TUI AG (LON:TUI) has agreed another €1.8bn (£1.64bn) of rescue funding that includes €509mln through a deeply discounted rights issue.
The package would be its third bailout of the pandemic and includes additional backing by the German Economic Support Fund WSF and a German government guarantee.
TUI said the package provides it with sufficient liquidity to cope with the volatile market environment and assumes travel restrictions are in place until the 2021 summer season.
Restrictions caused by a rising number of COVID-19 infections and more short-term bookings caused a funding shortfall, it added.
TUI already has a credit line of €2.85bn from German state-owned group KfW and a WSF warrant bond of €150mln and options over 58.7mln shares. This new package is in addition to this, it said.
To facilitate the rights issue, there will be a reduction of TUI’s share capital followed by the rights issue at a price per share of €1.07.
TUI’s largest single shareholder, Russian group Unifrim holding 24.89% of the shares, has committed to back the rights issue up to a total stake of 36%,
The proceeds of the share issue will be used to repay €300mln senior notes due in October 2021.
Including this financing package, as of 30 November 2020 TUI will have pro-forma financial resources and credit facilities of €2.5bn after the €300mln senior notes redemption.
