• TUI Group announces a fully underwritten capital increase with subscription rights of 1.8 billion euros
• Group plans to use proceeds to repay WSF aid in full and significantly reduce KfW credit line in order to reduce interest costs and debt
• Shareholders may acquire new shares at a subscription ratio of 8:3 and at a subscription price of 5.55 euros from 28 March up to and including 17 April 2023
• CEO Ebel: “With the proceeds from the capital increase we are implementing what we promised: the full repayment of the Corona state aid. TUI will have a good balance sheet structure and improved profitability. Profitable growth remains our goal for the future.”

With the approval of the Supervisory Board, TUI’s Executive Board today approved a capital increase with subscription rights of 1.8 billion euros. For the fully underwritten capital increase, 328,910,448 new shares will be offered in a subscription ratio of 8:3 (8 new shares for every 3 existing shares) and at a subscription price of 5.55 euros.

The subscription period for the new shares will start on 28 March and end on 17 April 2023. TUI intends to use the net proceeds from the capital increase to reduce interest costs and debt.

Sebastian Ebel, CEO TUI Group: “The full repayment of the Corona state aid was our declared goal. With the capital increase now approved, we are taking the final step with the WSF aid and fulfilling our commitment. We will use the proceeds to repay the aid received from the WSF, including interest. TUI thus has a good balance sheet structure again and we are doing everything we can to further improve the Group’s profitability. We are reducing interest costs and as a result creating a solid basis for the future. Our goal is clear: we want to grow profitably again and gain more market share with additional customers and new products. The booking trend also continues to be very encouraging.”

TUI will use the proceeds to repay in full or buy back at market value the Silent Participation I provided by WSF of a nominal 420 million euros and the outstanding Warrant Bond including warrants of around 59 million euros plus accrued interest. Therefore, WSF will receive a total of around 750 million euros. In addition, TUI had drawn parts of the KfW credit line over the winter. With the net proceeds these current drawings under der KfW credit line, amounting to around 440 million euros¹, will be repaid in full and thus replaced. With the remaining net proceeds, the current drawings of around 1.438 billion euros² under the 1.454 billion euros Cash Facility will be reduced to around 870 million euros. In addition, the Group intends to significantly reduce the 2.1 billion euros KfW credit line

The authorisations required for the capital increase have already been resolved at the Annual General Meeting in 2022. The 10:1 reverse stock split, as a condition for further repayment, was successfully implemented after the Annual General Meeting in 2023. Alexey A. Mordashov – or any connected person or entity – indirectly holds 30.91 percent in the Group via Unifirm Limited and Severgroup LLC. These shares continue to be locked as a result of far-reaching sanctions and under German securities law. He and or sanctioned persons or entities connected to him can therefore not participate in the Rights Issue and no subscription rights will be granted to them.

TUI expects that in the course of a successful implementation of the capital increase and the repayment of the announced state aid, net debt would have improved significantly from 3.4 billion euros at the end of financial year 2022 to 2.4 billion euros. It is expected that the Group’s gross leverage ratio already would return to the pre-crisis level for the financial year 2023 and fall to around 3.0x. In addition, the previous hybrid capital of the federal government will be completely replaced with real equity.

The capital increase is underwritten with Barclays Bank Ireland PLC, BofA Securities Europe S.A., Citigroup Global Markets Europe AG, COMMERZBANK Aktiengesellschaft, Deutsche Bank Aktiengesellschaft and UniCredit Bank AG acting as Joint Global Coordinators. HSBC Trinkaus & Burkhardt GmbH and Société Générale are acting as co-Joint Global Coordinators. Crédit Agricole Corporate and Investment Bank, ING Bank N.V. and Natixis are acting as Joint-Bookrunners. Barclays Bank PLC and Merrill Lynch International are acting as joint sponsors to the Company.

¹ as at 23 March 2023

² as at 23 March 2023

Hanover, 24 March 2023

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• Source: https://www.aviation24.be/tour-operators/tui-group/tui-intends-to-repay-corona-state-aid-in-full-after-capital-increase/