TUI AG (trading as TUI Group) is a German multinational leisure, travel and tourism company; it is the largest such company in the world. TUI is an acronym for Touristik Union International ('Tourism Union International'). TUI AG was known as Preussag AG until 1997, when the company changed its activities from mining to tourism. It is headquartered in Hanover, Germany, and trading on the Frankfurt Stock Exchange.
It fully or partially owns several travel agencies, hotel chains, cruise lines and retail shops as well as five European airlines. These activities involve the operation of 353 hotels with 275,144 beds and it allows its brand to be used for another 65 hotels operated by third parties. These hotels accommodate 21 million guests a year. It also operates 16 cruise ships under the TUI Cruises, Hapag-Lloyd Cruises and Marella Cruises brands, as well as a fleet of 134 aircraft.
Contents
History
Foundation and early years
The origins of the company lie in the industrial and transportation company Preussag AG, which was originally formed as a German mining company. It was incorporated on 9 October 1923, as Preußische Bergwerks- und Hütten-Aktiengesellschaft ('Prussian Mine and Foundry Company'). In 1927, it was merged with the Ruhr coal company, Hibernia AG, and electricity utility to become the Vereinigte Elektrizitäts und Bergwerks AG (VEBA AG, 'United Electrical and Mining Company').
While Preussag's roots were industrial, a parallel tourism lineage that predates the group's 1968 consolidation can be traced to early post-war package travel between Germany and Mallorca. In 1953, commercial relations began between the travel agency Dr Tigges (one of the forerunners of TUI) and the Riu family's hotel company, founded by Luis Riu Bertrán, offering vacation packages for German tourists to the beaches of Mallorca. The following year, Dr Tigges agreed to send organised German holidaymakers to the family's newly acquired Hotel Riu San Francisco in Playa de Palma, marking the start of RIU's longstanding cooperation with German tour operators.
After the sale of Salzgitter AG and purchase of Hapag-Lloyd AG (the navigation and logistics company) in 1997, Preussag AG became a global enterprise in the service and leisure industry. At that time, Hapag-Lloyd held a 30% interest in the tourism conglomerate TUI (founded 1968), increased to 100% by 1999. In addition, the company acquired 25% of Thomas Cook shares in 1997, which it doubled the following year. On 2 February 1999, the Carlson Leisure Group merged with Thomas Cook into a holding company owned by the German bank Westdeutsche Landesbank, Carlson Inc and Preussag. However, in mid 2000, Preussag acquired Thomas Cook's rival Thomson Travel and was forced to sell its majority 50.1% stake in Thomas Cook by regulatory authorities. In 2002, Preussag renamed itself TUI AG.
TUI announced a merger of its travel division with the British tour operator First Choice in March 2007, which was approved by the European Commission on 4 June 2007, on the condition that the merged company sell Budget Travel in Ireland. TUI held a 55% stake in the new company, TUI Travel plc, which began operations in September 2007.
In April 2008, Alexey Mordashov, who purchased his first shares in TUI Travel in autumn 2007, purchased additional TUI Travel shares under S-Group in order to expand TUI Travel into Eastern Europe and Russia.
Development since 2020
In August 2020, the company reported a net loss of €2.3 billion (from October 2019 to June 2020) as a result of the COVID-19 pandemic. Out of the sum, €1.5 billion loss related to the period from April to June 2020, while the revenue for the same period was €75 million, 98% less than the same period in 2019. TUI's chief executive officer, Fritz Joussen announced that the firm was considering selling Marella Cruises.
In March 2022, the company's largest single shareholder, Alexey Mordashov, a Russian oligarch and confidant of Vladimir Putin, was placed under sanctions due to the 2022 Russian invasion of Ukraine.
In April 2023 TUI raised around €1.8 billion for repayment of Wirtschaftsstabilisierungsfonds ("WSF") state aid and a significant reduction of the KfW credit line by selling shares at a discount to existing investors, excluding Mordashov due to sanctions under German securities law.
Corporate affairs
Governance
The following people have served in key roles:
Shareholders
The company's shares are listed on the Frankfurt Stock Exchange, the London Stock Exchange, as well as the Hanover Stock Exchange.
In spring 2007, the Norwegian shipowner and financial investor John Fredriksen acquired a 15.01% stake in TUI. At TUI's AGM in May 2008, Fredriksen demanded a split-up of the group and the dismissal of TUI CEO Michael Frenzel. At the AGM on 13 May 2009, Fredriksen demanded that Supervisory Board Chairman Jürgen Krumnow be voted out of office so that he could then join the Supervisory Board himself. However, these attempts were unsuccessful. On 28 February 2014, Monteray Enterprises Ltd (John Fredriksen) notified TUI that its share of voting rights in TUI had fallen below the 3% thresholds on 24 February 2014.
Russian oligarch Alexei Mordashov joined TUI at the beginning of 2008. By July 2008, he had increased his stake to 15.03% and in March 2012 to 25.29%, and later to 34%. He was thus the largest single shareholder. Mordashov has been on the EU sanctions list since 28 February 2022 and, according to a corresponding voting rights notification, transferred control of most of his indirectly held shares to the Virgin Islands-based company Ondero Limited, controlled by Marina Mordashova, on that date. Due to an investigation by the Federal Ministry of Economics and Climate Protection regarding the transfer of the shares to Ondero Limited, the transfer is suspended. The shareholding in TUI AG therefore continues to be held (indirectly) by Mordashov. Due to the capital increase in spring 2023, in which Mordashov was not allowed to participate due to his sanction, his shareholding has meanwhile decreased significantly. According to the voting rights notifications of the German Federal Financial Supervisory Authority of 16 May 2023, 10.87% shares in TUI AG have been indirectly attributable to Mordashov since 19 April 2023, while Marina Mordashowa holds 0% in TUI AG.
In February 2024, the company decided to leave the London Stock Exchange retaining its listings on the Frankfurt Stock Exchange and the Hanover Stock Exchange.
Business figures
The key indicators of the TUI Group were at the financial years ending 30 September:
Operations
Accommodation
In the 2022 financial year, the Hotels & Resorts segment comprised a total of 353 hotels with 275,144 beds. With 322 properties, the majority are four- or five-star hotels. 53% were operated under management contracts, 38% were owned by the respective hotel company, 8% were leased and 1% of the facilities were operated under franchise agreements. In addition, 65 hotels were operated by third-party hoteliers under TUI's international concept brands as at 30 September 2022, bringing the total number including third-party hotels to 418.
Cruises
TUI's cruise segment operates a total of 16 cruise ships under three brands:
TUI Cruises is a joint venture with Royal Caribbean Cruises. The fleet currently comprises seven ships named Mein Schiff 1 to 7.
Hapag-Lloyd Cruises is responsible for luxury and expedition cruises in German-speaking countries. The brand was transferred to TUI Cruises in 2020. With the MS Europa and the MS Europa 2, the group offers luxury cruises; the two ships were the only cruise ships worldwide to be awarded the 5-star-plus category by the Berlitz Cruise Guide. Hanseatic class expedition ships include the Hanseatic Nature, the Hanseatic Inspiration and the Hanseatic Spirit.
Marella Cruises offers cruises with four ships, primarily in the UK market.
Airlines
TUI owns several airlines operating under the brands TUI fly and TUI Airways which are managed by TUI Airline Management.
Strategic partnership with RIU Hotels & Resorts
TUI AG has maintained a long-standing strategic relationship with RIU Hotels & Resorts, which began in the 1950s when the German tour operator Dr Tigges partnered with the Riu family to offer holiday packages to Mallorca. In 1953, German tourists were first accommodated at the Hotel Riu San Francisco, owned by Luis Riu Bertran, marking the beginning of a collaboration that evolved over decades.
The hotel group is currently led by the children of Luis Riu Bertran, Luis Riu Güell and Carmen Riu Güell, who continue the family's involvement in the business. TUI remains a key distribution partner for RIU, channeling a substantial share of holidaymakers to RIU properties. As of 2024, RIU SA also holds a 1.1% stake in TUI AG.
Online travel platform
Founded in mid-2013, Musement was established as an Italian-based online travel platform that secured funding from 360 Capital Partners. It closed $10 million in Series B funding in 2016. Musement acquired Triposo in October 2017. In September 2018, Musement was acquired by TUI Group.
In October 2020, the prior TUI Destination Experiences, which owned Musement, was renamed TUI Musement.
Controversies
On 16 April 2009, TUI Travel and S-Group Travel Holding of the Russian shareholder Alexey Mordashov declared the formation of a joint venture in Russia with investments of 30 million euros to develop tourism activities in Russia and Ukraine. The intention was to take over the tour operators VKO Group and Mostravel in Russia and Voyage Kiev in Ukraine, which had over 160 travel agencies and over half a million customers. In March 2022, TUI AG terminated the brand use agreement with TUI Russia; TUI Russia is no longer a TUI Group company. The last shares in TUI Russia were sold in 2021. In May 2022, it was reported that the major stakeholder and Russian oligarch Alexei Mordashov had made a transfer of a holding of 29.9% of the company: TUI failed to follow the rules and verify the new owner of the shares. In addition, the transfer was a violation of the sanctions against Russia by the European Union, which sanctioned Mordashov personally.
A 2018 study in the UK found that TUI had the largest gender pay gap reported to date by a major UK company, with its male employees paid more than twice what female employees are paid.
TUI has become the main airline carrying out charter deportation flights for the UK Home Office. It is estimated that in November and December 2020 TUI carried out the deportation of more than 150 people in 13 flights to 23 destinations for the Home Office.