TUI tourism division and First Choice join forces
Creation of one of the world’s leading travel group / TUI Travel PLC to be based in the UK / TUI AG majority shareholder with 51 per cent. / Powerful alliance generating 18 billion euros of revenues with 27 million customers
Hanover/Hamburg, 19 March 2007. The Boards of TUI AG and the British First Choice Holidays PLC (“First Choice”) have today agreed to create a unique leisure travel group which will also be one of the world’s most profitable travel companies. TUI AG will merge its tourism division, excluding certain hotel assets with First Choice. The new leisure travel group will be called TUI Travel PLC. TUI Travel PLC will be headquartered in the UK and will seek admittance to trading on the London Stock Exchange. TUI AG will have a majority shareholding with 51 per cent., with existing shareholders of First Choice holding 49 per cent. (calculated on a fully diluted basis). Chief Executive Officer designate of the new company is Peter Long, who is currently Chief Executive of First Choice. As authorised by the Supervisory Board of TUI AG in an extraordinary meeting last night, the executive board has approved the Merger. The merger is subject to approval by the existing shareholders of First Choice and approval by the relevant anti-trust authorities. “We are creating one of the most profitable and efficient tourism groups in the world“, said TUI Chief Executive Dr. Michael Frenzel, who will become Chairman of TUI Travel PLC. And he continued: “At just the right time two strong partners are joining forces: TUI Travel PLC is clearly aiming at growth and simultaneously will make good use of the opportunities presented by the ongoing consolidation in the European travel market.“
The different strengths of the two partners represent an excellent fit. “TUI is clearly the market leader in traditional beach package holidays. And over the past few years First Choice has successfully expanded in the modular travel segment and in certain niche markets, and in doing so has achieved above average returns. Both partners will benefit from the know how of the other“, said Peter Long, current Chief Executive Officer and Chief Executive Officer Designate of TUI Travel PLC.
The travel company being created under the umbrella of TUI Travel PLC will have, on the basis of the composite figures of the 2006 financial year, a revenue of approximately 18 billion euros (12.1 billion pound Sterling) and EBITA of around 475 million euros (325 million pound Sterling). Last year, approximately 27 million holidaymakers travelled with the tour operators and airlines of TUI Travel PLC (for further information see “Facts about the new TUI Travel PLC“).
TUI Travel PLC anticipates an annual synergy potential amounting to approximately 146 million euros (100 million pound Sterling) as a result of the Merger to be fully realised within three years of completion. The majority of the synergy effects will be in the British market and will be achieved for instance by having joint administration, joint fleet and flight planning in the airlines, introducing a common IT infrastructure and a more efficient use of marketing instruments. It is as yet uncertain how many jobs will be lost as a result of the merger. Jobs in Germany will not be directly affected by the merger.
The formation of TUI Travel PLC is at the right juncture according to Dr. Frenzel. “We have used the past year to do our homework. Many structural and operational measures have been started. Now we are fit for the future“, said Dr. Frenzel. The TUI AG Chief Executive emphasized that the new TUI Travel PLC is in a position not only to secure its footprint in a strongly competitive environment but also to extend it. Dr. Frenzel: “By taking this step we are creating room to take positive action and are driving forwards the consolidation of the European tourism business. At the same time this undertaking underlines our intention of pushing forward the two pillar strategy of the TUI Group.“
The TUI Travel PLC will be headed by Peter Long as Chief Executive Officer designate. The board will consist of 17 members, including will be Sir Mike Hodgkinson (Non-Executive Deputy Chairman), Peter Rothwell (Deputy Chief Executive), Paul Bowtell (Chief Financial Officer), Will Waggott (Group Commercial Director), Christoph R. Mueller (Aviation Director) and Volker Böttcher (Managing Director Central Europe).
You will find this press release as well as photographs and CVs of the new management of TUI Travel under www.tui-group.com
Creation of one of the world’s leading travel group / TUI Travel PLC to be based in the UK / TUI AG majority shareholder with 51 per cent. / Powerful alliance generating 18 billion euros of revenues with 27 million customers
Hanover/Hamburg, 19 March 2007. The Boards of TUI AG and the British First Choice Holidays PLC (“First Choice”) have today agreed to create a unique leisure travel group which will also be one of the world’s most profitable travel companies. TUI AG will merge its tourism division, excluding certain hotel assets with First Choice. The new leisure travel group will be called TUI Travel PLC. TUI Travel PLC will be headquartered in the UK and will seek admittance to trading on the London Stock Exchange. TUI AG will have a majority shareholding with 51 per cent., with existing shareholders of First Choice holding 49 per cent. (calculated on a fully diluted basis). Chief Executive Officer designate of the new company is Peter Long, who is currently Chief Executive of First Choice. As authorised by the Supervisory Board of TUI AG in an extraordinary meeting last night, the executive board has approved the Merger. The merger is subject to approval by the existing shareholders of First Choice and approval by the relevant anti-trust authorities. “We are creating one of the most profitable and efficient tourism groups in the world“, said TUI Chief Executive Dr. Michael Frenzel, who will become Chairman of TUI Travel PLC. And he continued: “At just the right time two strong partners are joining forces: TUI Travel PLC is clearly aiming at growth and simultaneously will make good use of the opportunities presented by the ongoing consolidation in the European travel market.“
The different strengths of the two partners represent an excellent fit. “TUI is clearly the market leader in traditional beach package holidays. And over the past few years First Choice has successfully expanded in the modular travel segment and in certain niche markets, and in doing so has achieved above average returns. Both partners will benefit from the know how of the other“, said Peter Long, current Chief Executive Officer and Chief Executive Officer Designate of TUI Travel PLC.
The travel company being created under the umbrella of TUI Travel PLC will have, on the basis of the composite figures of the 2006 financial year, a revenue of approximately 18 billion euros (12.1 billion pound Sterling) and EBITA of around 475 million euros (325 million pound Sterling). Last year, approximately 27 million holidaymakers travelled with the tour operators and airlines of TUI Travel PLC (for further information see “Facts about the new TUI Travel PLC“).
TUI Travel PLC anticipates an annual synergy potential amounting to approximately 146 million euros (100 million pound Sterling) as a result of the Merger to be fully realised within three years of completion. The majority of the synergy effects will be in the British market and will be achieved for instance by having joint administration, joint fleet and flight planning in the airlines, introducing a common IT infrastructure and a more efficient use of marketing instruments. It is as yet uncertain how many jobs will be lost as a result of the merger. Jobs in Germany will not be directly affected by the merger.
The formation of TUI Travel PLC is at the right juncture according to Dr. Frenzel. “We have used the past year to do our homework. Many structural and operational measures have been started. Now we are fit for the future“, said Dr. Frenzel. The TUI AG Chief Executive emphasized that the new TUI Travel PLC is in a position not only to secure its footprint in a strongly competitive environment but also to extend it. Dr. Frenzel: “By taking this step we are creating room to take positive action and are driving forwards the consolidation of the European tourism business. At the same time this undertaking underlines our intention of pushing forward the two pillar strategy of the TUI Group.“
The TUI Travel PLC will be headed by Peter Long as Chief Executive Officer designate. The board will consist of 17 members, including will be Sir Mike Hodgkinson (Non-Executive Deputy Chairman), Peter Rothwell (Deputy Chief Executive), Paul Bowtell (Chief Financial Officer), Will Waggott (Group Commercial Director), Christoph R. Mueller (Aviation Director) and Volker Böttcher (Managing Director Central Europe).
You will find this press release as well as photographs and CVs of the new management of TUI Travel under www.tui-group.com
