Tui Group, one of the largest travel groups in Europe, is reportedly set to raise €1.1 billion (~USD 1.2 billion) to enhance its balance sheet as the travel industry starts to recover from the worst effects of the COVID-19 pandemic.
Reports suggest, Tui saw its UK winter bookings trending strongly after the UK government’s update on travel rules was released on 17th September 2021. The company believes that customers would continue to show interest in securing summer holidays ahead of time.
Tui reportedly said that the UK government’s announcement urged companies to adopt a travel framework similar to that of European markets and was a clear step in further reopening international travel for its UK customers.
The firm’s total bookings for summer 2022 have seemingly gone up 54% compared to the pre-pandemic summer of 2019. Currently, Florida, Turkey, Cyprus, and Greece are the most popular travel destinations among customers, Tui stated.
With strong hints towards pent-up demand for travel and tourism, the company hopes that summer 2022 bookings would revert to normal levels of summer 2019. Evidently, early Marella Cruises sales for summer 2022 are well-positioned, backed both by new bookings and rebookings.
The capital rise would supposedly give Tui €4.5 billion (~USD 5.2 billion) in cash as well as available facilities. This move is intended to help the firm slash debt and interest costs.
Tui Group, CEO Fritz Joussen stated that the offering would allow Tui to take a massive step further, improving its ability to leverage business opportunities emerging from the easing of COVID-19 lockdown restrictions.
Joussen further added that the move would also provide Tui with a capital structure that is appropriate for more normal operating situations.
Notably, the company reported 5.2 million bookings in its summer 2021 program, up by 1.1 million since its August 2021 update.
Apparently, Tui expects a significantly better 2021-22 winter bookings than 2020-21 owing to the lifting of travel restrictions for certain places and increasing vaccination rates of the adult population in the UK and EU. It plans on operating between 60% and 80% of a normalized program, with long-haul destinations slated to recover at a slower pace.
Source credit: https://travelweekly.co.uk/news/air/tui-to-raise-e1-1bn-as-travel-restrictions-ease