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TUI Travel and TUI AG to merge

Staff writer |
The Independent Directors of TUI Travel and the Executive Board (Vorstand) of TUI AG have reached an agreement in principle on the key terms of a possible all-share nil-premium merger of TUI Travel and TUI AG.

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The merger, if consummated, is anticipated to deliver a number of strategic and financial benefits for both the TUI Travel shareholders and TUI AG shareholders. Under the terms discussed between the parties, TUI Travel shareholders (other than TUI AG and certain connected parties) would receive 0.399 new TUI AG shares for each TUI Travel share that they own.

Ther merger will creat a German domiciled Group with a premium listing on the London Stock Exchange with an intention to seek inclusion in the FTSE UK Index Series (including FTSE 100), in parallel to a quotation on a German stock exchange

There is an intention to adhere to both the UK Corporate Governance Code and the German Corporate Governance Code to the extent practicable. The Group is expected to be subject to the shared jurisdiction of the UK Takeover Code and applicable German takeover law.

TUI AG and TUI Travel expect that any dividends paid for the 2013/2014 financial year would ensure equivalent payment to TUI AG and TUI Travel shareholders, taking into account the exchange ratio and would be in line with the current TUI Travel dividend policy.

The Group intends to review its future dividend policy following completion of the Merger and in light of its expected profits and free cash flow generation, targeting a level which is in line with TUI Travel's current dividend policy.


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