REG-TUI AG TUI AG: Agreement with the German Economic Stabilization Fund on repayment of stabilization measures & their refinancing by means of a capital increase following implementation of a capital reduction

TUI AGAnnouncement

13/12/2022 18:00

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   TUI AG (TUI)
   TUI AG: Agreement with the German Economic Stabilization Fund on repayment
   of stabilization measures & their refinancing by means of a capital
   increase following implementation of a capital reduction

   13-Dec-2022 / 18:48 CET/CEST
   Dissemination of a Regulatory Announcement that contains inside
   information in accordance with the Market Abuse Regulation (MAR),
   transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   Conclusion of an  agreement with  the German  Economic Stabilization  Fund
   (WSF) on the repayment of stabilization measures and their refinancing  by
   means of  a capital  increase following  the implementation  of a  capital
   reduction

    

   Publication of inside  information pursuant  to Article  17 of  Regulation
   (EU) No. 596/2014

    

   Hanover,  13  December  2022.  Today,  the  Executive  Board  of  TUI   AG
   ("Company"; ISIN DE000TUAG000 (voting  and dividend-bearing shares),  ISIN
   DE000TUAG331  (voting  shares  only))  has,   with  the  consent  of   the
   Supervisory  Board,  concluded  an  agreement  with  the  German  Economic
   Stabilization Fund  (“WSF”) on  the  repayment of  stabilization  measures
   (“Repayment Agreement”). This  agreement regulates  the intended  complete
   termination of the stabilization measures granted by the WSF by means of a
   right of the Company (i) to repayment of the contribution made by the  WSF
   as a silent partner in January 2021 in the nominal amount of currently 420
   million Euros  (“Silent  Participation  I”) and  (ii)  to  repurchase  the
   warrant-linked bond 2020/2026  (“Warrant Bond”) issued  by the Company  to
   WSF in the remaining amount of 58.7 million Euro as well as the 58,674,899
   option rights (“Warrants”)  originally attached  to the  warrant bond.  In
   addition, the Repayment Agreement regulates the implementation of  capital
   measures for the purpose of refinancing the aforementioned measures.

    

   Under the  Repayment Agreement,  the  Company is  obliged, to  the  extent
   permitted by law,  to propose to  the General Meeting  a reduction in  the
   Company’s share capital from currently  approx. EUR 1.785 billion to  then
   approx. EUR 179 million by consolidating shares  at a ratio of ten to  one
   in accordance with  the provisions  of the  German Economic  Stabilization
   Acceleration   Act   (Wirtschaftsstabilisierungsbeschleunigungsgesetz    -
   “WStBG”). The amount of the reduction of approx. EUR 1.606 billion will be
   allocated to the Company's capital reserves and will not be distributed to
   shareholders. The capital reduction shall pave the way for the termination
   of the stabilization measures and is thus related to the  recapitalization
   of the Company implemented in January  2021. The invitation to the  Annual
   General  Meeting,  including  the   full  agenda  and  the   corresponding
   resolution proposals from Company management, is expected to be  published
   in the  German  Federal  Gazette (Bundesanzeiger)  and  on  the  Company’s
   website at the beginning of January 2023.

    

   Pursuant to the recapitalization measures adopted in January 2021, WSF has
   the right to convert Silent Participation  I at a conversion price of  EUR
   1.00 per share into currently up to 420 million shares in the Company.  In
   addition, under  the Warrants,  the WSF  has the  right to  subscribe  for
   currently up to  58,674,899 shares in  the Company at  an option price  of
   1.00 euro  per  share,  whereby the  option  price  can also  be  paid  by
   contributing the Warrant Bond.

    

   The repayment agreement provides for a  right of the Company to  terminate
   the Silent Participation I in full and to repurchase the remaining Warrant
   Bond together with  all Warrants  until 31  December 2023  at a  repayment
   price of 730,113,240.00 euros plus interest accruing until repayment under
   the stabilization measures. In economic terms, this price accounts for the
   existing conversion and option rights of the WSF. If the weighted  average
   stock exchange price of the shares of the Company during the last  fifteen
   calendar days  prior  to  the  date of  the  public  announcement  of  the
   Refinancing Capital Increase referred to below, as adjusted for the  price
   increase effect of the share consolidation, (“Adjusted Average Price”), is
   higher than  1.6816  euros, the  repayment  price shall  be  increased  in
   accordance with the repayment agreement  as follows: The Adjusted  Average
   Price less a  discount of 9.3%  shall be multiplied  by the total  nominal
   amount of the stabilization measures in  the amount of EUR 478.7  million,
   capped at a maximum amount of EUR 957.4 million.

    

   WSF undertakes  not to  exercise its  conversion and  option rights  under
   Silent Participation  I  and the  Warrants  until 31  December  2023.  The
   Company is obliged to  exercise its repayment  and repurchase right  under
   the Repayment  Agreement in  the  event of  successful completion  of  the
   Refinancing Capital  Increase  referred  to below.  If  the  stabilization
   measures are not fully  terminated by 31 December  2023, the Company  will
   pay WSF an at market standstill premium.

    

   To finance  the repayment  of the  WSF  and thus  the termination  of  the
   stabilization measures,  the  Company  is obligated  under  the  Repayment
   Agreement, to the  extent permitted  by law, to  use its  best efforts  to
   implement a  rights issue  capital increase  from the  Authorized  Capital
   2022/I existing pursuant to Art. 4  par. 5 of the Articles of  Association
   in the  amount of  approx. 162  million euros  and potentially  also  from
   Authorized Capital  2022/II existing  pursuant to  Art. 4  par. 7  of  the
   Articles of  Association  in  the  amount of  approx.  627  million  euros
   (“Refinancing Capital  Increase”). This  obligation applies  for a  period
   starting from  the effective  date of  the capital  reduction referred  to
   above until 31 December 2023 –  subject to the positive assessment of  the
   then prevailing capital market conditions  by the Board of Management  and
   Supervisory Board.  The proceeds  from this  Refinancing Capital  Increase
   shall be used primarily for a full repayment of Silent Participation I and
   a repurchase of the Warrant Bond and the Warrants.

    

   The Company  intends to  use (i)  the proceeds  from the  exercise of  the
   Authorized Capital  2022/I  exclusively  for  the  priority  of  the  full
   repayment of the WSF and (ii) the proceeds from the exercise of Authorized
   Capital 2022/II predominantly for a substantial redemption of KfW's credit
   lines, it being understood  that both capital  increases shall be  carried
   out simultaneously in one subscription offer.

    

   The closing of the repayment agreement is still subject to confirmation by
   the European Commission that it does not raise any objections under  state
   aid law.

    

    

   ANALYST & INVESTOR ENQUIRIES

   Nicola Gehrt, Group Director Investor Relations       + 49 (0)511 566 1435
   Adrian Bell, Senior Investor Relations Manager        +49 (0)511 566 2332
   James Trimble, Investor Relations Manager             + 44 (0)1582 315 293
   Stefan Keese, Investor Relations Manager (Retail      + 49 (0)511 566 1387
   Investors)
   Anika Heske, Junior Investor Relations Manager        + 49 (0)511 566 1425
   (Retail Investors)
   Media                                                  
   Kuzey Alexander Esener, Head of Media Relations       + 49 (0)511 566 6024

    

    

    

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   ISIN:           DE000TUAG000
   Category Code:  MSCU
   TIDM:           TUI
   LEI Code:       529900SL2WSPV293B552
   OAM Categories: 2.2. Inside information
   Sequence No.:   208375
   EQS News ID:    1512229


    
   End of Announcement EQS News Service

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