TUI - Recent press speculation confirms the unique position of the Tui bonds

Press reports yesterday reported on plans that TUI is seeking to raise further finances to navigate through the Covid-19 crisis.  Handelsblatt, the German financial paper, reports that Alexey Mordashov, TUI’s largest shareholder has already committed €300m.  Additionally, the Company is expected to raise a further €1bn via more asset sales, with hotels, aircraft and its Marella cruise business all likely to be put up for sale.  

The €300m bond, which is pari-passu with the extended RCF, rallied on the back of this news.  The outlook for the Company remains uncertain with a further uncertainty over quarantine rules and the increased refund demand due to commitment given to UK Competition and Markets Authority to refund all UK customers by end of September. However, given the short-dated nature of the bonds, any fundraising is likely to see the bonds been repaid on time. 

Tomás