TUI To Receive Addl EUR 1.2 Bln Aid Package From German Government

TUI AG (TUIFF.PK) said Wednesday that it would receive an additional 1.2 billion euros aid package from the German government.

The aid package strengthens the company's position and would provide sufficient liquidity in the volatile market environment to cover the company's seasonal swing through Winter 2020/21 and thereafter and in the case of any further long-term travel restrictions and disruptions related to COVID-19, the company said in a statement.

The majority of the aid will come from state-owned lender KfW, which will extend TUI's existing credit line by 1.05 billion euros. The remaining 150 million euros will come from the issue of convertible bonds to Germany's Economic Stabilization Fund, the company said.

The additional KfW tranche is also subject to a waiver of a potential future limitation of TUI's financial indebtedness under the Senior Notes due in October 2021.

In April, KfW provided the company with a 1.8 billion euros loan.

TUI said it would, as of today, have cash and available facilities of 2.4 billion euros that includes the additional aid package.

The company said in May that it expected to permanently reduce its overhead cost base by 30 percent across the entire Group, impacting potentially 8000 jobs globally that would either not be recruited or reduced.

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