TUI: divests Hapag-Lloyd Cruises to joint venture

(CercleFinance.com) - On Friday the German group TUI AG announced that it will transfer its luxury cruise business Hapag-Lloyd Cruises to the joint venture it has formed with the US Royal Caribbean, as part of a deal that values its subsidiary at around 1.
2 billion euros.

The transaction - which is expected to be completed in the summer - should result in the recording of a "substantial" accounting gain, the tourism group says, which mentions a net cash inflow of around 700 million euros.

From an operational viewpoint, the merger will enable TUI Cruises, its joint venture with Royal Caribbean, to strengthen its position in luxury, expedition and exploration cruises, with Hapag-Lloyd Cruises being particularly present on the German market.

However, the announcement did not really make big waves in the market, with TUI's share price up just 0.5% on the London Stock Exchange in late morning trading. The tourism group's share has lost almost half its value over the past two years.


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