TUI approve sale of Hapag-Lloyd AG

On October 12, 2008, TUI AG’s Supervisory Board approved the sale of Hapag-Lloyd AG. The bid will be awarded to the Hamburg-led consortium that won the bidding process. Hapag-Lloyd AG will be sold to a subsidiary of Albert Ballin KG at an enterprise value of 4.45 billion euro. TUI AG will be an active investor in the new company by investing in a 33.33 per cent entrepreneurial stake in the new company at a purchase price of 700 million euro.

“Despite an adverse environment, the price we have achieved for container shipping reflects its fair value even under normal market conditions,” said TUI CEO Dr. Michael Frenzel. He continued, “Selling only two thirds of Hapag-Lloyd has made this price possible. In addition, our entrepreneurial stake will offer us the opportunity to benefit from the future earnings potential.” The transaction will be subject to approval by the anti-trust authorities.

The TUI CEO emphasized that the consortium submitting the better offer had won the bid in a fair bidding process. A neutral investment bank not involved in this sale process has confirmed in a fairness opinion that a fair sale price has been achieved and that the decision was exclusively based on value criteria. Frenzel, “The sale to the Hamburg-led consortium is a positive outcome for the shareholders of TUI AG, for Hapag-Lloyd and its employees and not least for Hamburg and for Germany.”
TUI AG is entitled to sell shares in the company. The co-shareholders have a pre-emption right. Moreover, TUI has a right of first offer to sell the shares to the Hamburg-based consortium. The first exercise date for this option will be January 1, 2012. Dr. Michael Frenzel will remain head of the Supervisory Board of Hapag-Lloyd AG.

As already announced, the shareholders of TUI AG are to receive an appropriate special dividend following the completion of the sale. The amount to be distributed for the 2008 financial year will be determined in the context of the preparation of the annual financial statements.

The Group’s strong liquidity and financial situation resulting from the sale will open up investment opportunities for the further expansion of the tourism business of TUI AG. One of the options to be explored in this connection also includes a takeover of the outstanding shares in TUI Travel PLC.