February 7, 2020 - "The TUI Group wants to significantly expand the luxury, expedition and premium segment for cruises together with its long-term partner Royal Caribbean and win new customer groups for luxury cruises ”. This is today's press statement from the Hanover-based TUI Group.
A TUI press release from today indicates that TUI and Royal Caribbean intend to start the joint venture founded in 2008 TUI Cruises to expand significantly. At the Hamburg joint venture TUI Cruises the TUI Group and Royal Caribbean each hold 50 percent. The aim of the project is to let the luxury brand Hapag-Lloyd Cruises grow faster.
Mein Schiff 2 in the port of Puerto del Rosario / Fuerteventura
Until now, Hapag Lloyd, which is also based in Hamburg, belonged solely to the TUI Group. TUI and Royal Caribbean intend to use the deal to make Hapag Lloyd Cruises the second pillar of their successful joint investment. The companies expect an optimal starting position for accelerated growth in the Cruises Division.
According to the takeover conditions, Hapag Lloyd Cruises is valued at 1,2 billion euros. For the TUI Group, the transaction has the pleasant side effect that 700 million euros in cash flow into the TUI till. The group uses the income to strengthen the TUI group balance sheet and to accelerate the digital transformation. The company participates in the global growth of the cruise industry while using less capital. The measure seems to be important: Hapag-Lloyd Cruises earned 30 million euros in the past financial year (September 305). The adjusted company result (Ebita) was 43 million euros. The amount is reduced by interest and depreciation.
Hapag Lloyd Cruises - the former Hanseatic
Nothing will change in the ownership structure within the TUI Cruises portfolio company. Original sound of the press release: “The merger of Hapag-Lloyd Cruises and TUI Cruises under the umbrella of the joint venture creates a leading European cruise company with a fleet of currently twelve ships. TUI Cruises and Hapag-Lloyd Cruises will continue to operate with their successful product concepts in the future: TUI Cruises will continue to serve the German-speaking premium segment. Hapag-Lloyd Cruises is only present in the luxury and expedition segment ”.
The TUI Group has not yet commented on management issues. Both companies are run by highly qualified and committed managers. We are curious to see what effects the merger will have on management.