TUI confirms deal with Air Berlin
TUI Travel has agreed the terms of a strategic cooperation between its German aviation business, TUIfly, and Air Berlin.
Under the terms of the deal, TUIfly will continue to operate 38 aircraft and will enter into long-term wet lease contracts with Air Berlin and TUI Germany.
If the tie-up is approved, 17 aircraft will be operated for Air Berlin on ‘city-pair’ routes and 21 aircraft will be operated under the TUIfly brand, providing dedicated capacity for TUI’s charter business in Germany.
TUI Travel will acquire a 19.9% equity stake in Air Berlin for cash consideration of €64.8 million, via a capital increase in Air Berlin.
In return, Air Berlin will acquire a 19.9% equity stake in TUIfly for €36.3 million, also in cash.
Upon completion, TUI Travel will receive the right to nominate one non-executive director to the Board of Air Berlin.
TUI said the deal would secure the future of TUIfly for customers and employees. The airline division generated an operating loss of around €35m in the year ending September 30 2008.
The Transaction is subject to anti-trust clearances in Germany, Austria, Spain and Portugal and has an effective date of October 1 2009, depending on the satisfaction of certain customary conditions.
TUI Travel chief executive officer Peter Long said: “I am delighted to have agreed a commercial deal which not only optimises our tour operator programme in Germany but also minimises the disruption to our colleagues within TUIfly, who despite the recent uncertainty, have continued to deliver an excellent performance in the airline. Furthermore, I look forward to a successful strategic partnership with Air Berlin.â€
By Bev Fearis
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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