TUI Group: CEO Resignation & Repayment of State Aid

Photo Credit: Harrison Rowe/AviationSource

LONDON – Over the past few days at the end of June, TUI Group has announced their Chief Executive Officer replacement as well as detailed their repayment of State Aid.

The CEO Resignation…

TUI Group is a German leisure travel company and the main body responsible for the operations of five subsidiary airlines within Europe, those are, TUI fly Deutschland, TUI Airways (United Kingdom), TUI fly Belgium, TUI fly Netherlands and TUI fly Nordic (Denmark, Finland, Norway, and Sweden).

On June 24, the group announced that their current Chief Executive Officer, Fritz Joussen, after around 10 years as CEO will be handing over his CEO position to the group’s current Chief Financial Officer, Sebastian Ebel.

The changeover is set to take place at the end of September 2022 and is a result of Fritz Joussen exercising his right of resignation that was granted during the Covid pandemic as part of the group’s Corona stabilization measures.

Joussen has since informed the group’s Chairman of the Supervisory Board, Dr. Dieter Zetsche, and the employees of the group about his decision to resign.

Ebel will then hold the CEO position for three years initially and replacing his current role as CFO will be Mathias Kiep who was previously Group Director Controlling, Corporate Finance, and Investor Relations.

Commenting on his decision to resign, Fritz Joussen, says, “When the pandemic in spring 2020 turned us into a company without a business virtually overnight, all our attention was focused on one goal: rescuing TUI. The immediate crisis management, which was about ensuring the Group’s continued survival, has now been completed.”

“We have a high level of liquidity, are no longer using state credit lines and the operating business is back: as announced, we expect a strong summer of travel almost at the level of 2019.”

“Under new management, TUI is now starting the next chapter: a return to profitable growth – of course, coupled with tasks from this crisis: reducing debt, strengthening the balance sheet, and the further transformation of TUI.”

“In addition, there are operational Corona late effects for the entire industry in these weeks, for example at the airports and in flight operations.”

“Now that the existential crisis has been mastered, the time is right for a change at the top of TUI. I am delighted that Sebastian Ebel, a new CEO with whom I have enjoyed a long and trusting working relationship, is to take over.”

“TUI is in very good hands with him. Sebastian Ebel will lead TUI back onto the growth path.”

Adding thoughts to Joussen’s resignation, Dr. Dieter Zetsche has said, “The crisis threatening our viability has been mastered. We are now entering the next phase. Sebastian Ebel is to become TUI’s new CEO.”

“He is an excellent choice for a new start after the Corona crisis. As a member of the Executive Board, Sebastian Ebel was responsible for the strategic growth areas of hotels, cruises, and activities for many years and developed them into the Group’s most profitable segments.”

“I have worked closely with him over the past years and greatly appreciate his expertise and reliability. I am convinced that he will lead TUI to new successes. He is extremely entrepreneurial and has clear strategic and operational ambitions for TUI’s development.

He will drive the strengthening of the balance sheet and has clear ambitions for product, service, and profitable growth of the business lines.”

“The Supervisory Board regrets Fritz Joussen’s decision – and I personally regret it, too. In 2013, Fritz Joussen took over a Group threatened with being split up, successfully restructured it, and gave TUI its current future-proof shape.”

“This transformation is very much his success story. With a clear focus on the core business, the orientation toward a strong global brand, the massive expansion of the profitable segments of hotels, cruises, and activities, and the consistent digitalization of the Group, he has turned TUI into a company that was on course for growth until the pandemic.”

“Fritz Joussen led TUI safely and with a clear focus through the existential Corona crisis and laid the foundation for the Group to now focus on profitable growth again.”

“TUI is now more global, efficient, and digital than ever before. This is to the credit of Fritz Joussen. I would like to thank him most sincerely for the very good and trusting cooperation over the past years – also on behalf of the entire Supervisory Board and all employees.”

State Aid Repayment

TUI has once again further repaid state aid that it had received as part of stabilizing itself during the Covid pandemic as well as reducing credit lines.

As part of this announcement, TUI has repaid in full €671 million plus interest, for a total of €725 million to WSF (Economic Stabilisation Fund) from the group’s capital increase in May as part of the Silent Participation II. On top of this, they have also reduced their currently undrawn KfW credit lines from €2.4 billion to €2.1 billion.

After the latest repayment and reduction, the group’s remaining state aid is as follows –

  • WSF Silent Participation I – €420 million that can be converted into 420 million shares.
  • WSF Warrant Bond – €59 million that can be converted into 59 million shares.
  • KfW Credit Lines – €2.1 billion that is currently undrawn.

Overall, these shifts in direction from the TUI Group will no doubt set them into a better position off the back of what is going to be a busy Summer 2022 season.

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