Europe’s largest travel organizer TUI is at the outset of a major downsizing, its chief executive said, with plans to sell or integrate more than 100 of its 650 subsidiaries to streamline its complex, costly corporate sturcture.
“We want to concentrate on our core business,” said the TUI chief-executive, Friedrich Joussen, in an exclusive interview with Handelsblatt. That means the firm will focus on leisure travel, rather than on niche products such as language trips or adventure travelling, he said.
The change are coming about as a result of TUI’s upcoming merger with one of its subsidiary U.K.-based Tui Travel, which Mr. Joussen announced in June. Until now, the U.K. subsidiary of the German parent, which is based in Hanover, has been separately listed on the London stock exchange, though it is 54.5 percent owned by the Frankfurt-listed TUI AG.
While TUI AG, which also owns hotels and cruise companies including Hapag-Lloyd has a stake in some 650 different companies worldwide, the lion share of its revenue – 96 percent – has long come from Tui Travel.
Should shareholders approve the merger, the German parent will buy the rest of the shares of TUI Travel, simplifying its corporate structure and making the firm more flexible.
One share of Tui Travel is to be swapped into 0.399 of new TUI AG shares under the plan.