Hanover, 8 August 2023

TUI focuses on growth: expansion of hotel portfolio via global hotel fund

  • Hotel fund initiated by TUI becomes operational for the first time: Acquisition of the newly opened "Emerald Zanzibar Resort & Spa" on Zanzibar by the fund-operation by TUI Hotels & Resorts
  • The fund also intends to acquire a hotel property from the TUI portfolio, hotel will continue to be operated by TUI hotel brand in the long term
  • The fund has further capital for acquisitions and is looking at possible hotel projects

Against the backdrop of a return to normal operating business, TUI is increasingly focusing on profitable growth again. This is to be generated in particular by expanding its own product portfolio. TUI's hotel brands are among the key growth drivers and contribute significantly to the TUI Group's earnings. The Hotels & Resorts sector has been generating consistently positive results for several quarters and its underlying EBIT for the last four quarters has even exceeded the respective pre-crisis level. The Group intends to use this momentum to further expand the hotel portfolio. The asset-right strategy already initiated at the end of 2019 via management and franchise contracts as well as successful joint ventures and investment partnerships will serve this purpose.

In the current financial year, the hotel portfolio was expanded by 32 properties, some being operated under the TUI Blue brand. In order to further accelerate the less capital-intensive expansion, the global hotel fund was also initiated last year and, following an initial successful phase of capital raising, is now moving into the first investment phase. The fund, which was launched together with Luxembourg-based HANSAINVEST, has acquired the 5-star "Emerald Zanzibar Resort & Spa" on Zanzibar in Tanzania. The parties have agreed not to disclose the purchase price. Peter Krueger, member of the TUI AG Executive Board responsible for Group Strategy and M&A, as well as the growth segment Holiday Experiences, which includes hotels and hotel brands and participations: "Profitable growth is the focus of our strategy for the future. Our own hotel and club brands make a significant contribution to growth and the company earnings and offer our guests exclusive products. We initiated the hotel fund with the aim of further expanding our successful hotel portfolio and increasing the earnings of the segment, while at the same time being able to offer professional investors an attractive hotel property investment. We have succeeded in doing this well, the fund is equipped with initial funds and is operational. Now we are moving into the first investment phase. The fund has the means to purchase further hotels. The next concrete investment opportunities are already being pursued."

After a transition period, the all-inclusive resort will be operated by TUI Hotels & Resorts from the beginning of 2024, and all bookings already made by guests will be taken over. TUI is thus expanding its offering on the East African island to four hotels. In addition to the TUI Blue Bahari Zanzibar, the Group also operates the RIU Palace Zanzibar and the RIU Jambo there together with RIU.

The fund also intends to acquire a hotel property from TUI's portfolio. This is currently operated by a TUI hotel brand and will continue to be run as such in the future by means of a management contract. Here, too, the parties have agreed not to disclose the purchase price. TUI will invest the proceeds of the sale in further hotel growth.

Global hotel fund

For decades, TUI has very successfully designed and operated leading and high-quality brands in the holiday hotel industry such as RIU, Robinson or TUI Blue and developed holiday destinations. This position is also to be further expanded via the global hotel fund launched with HANSAINVEST, which is primarily aimed at institutional investors with a long-term investment horizon.

The fund is designed for growth and plans to invest primarily in new hotel facilities that are acquired or newly developed and are not currently part of the TUI Group. The properties will essentially be operated under the TUI Group's international hotel brands (such as Robinson or TUI Blue) and managed operationally by TUI. The return from the investment in hotel assets accrues to the fund investors. TUI receives ongoing remuneration for operating the hotel facilities and for providing investment advice to the fund.

About TUI Group

The TUI Group is one of the world's leading tourism groups and operates worldwide. The Group is headquartered in Germany. TUI shares are listed in the Prime Standard of the Frankfurt Stock Exchange, in the regulated market of the Lower Saxony Stock Exchange in Hanover and in the FTSE 250, an index of the London Stock Exchange. TUI Group offers its 19 million customers integrated services from a single source and forms the entire tourism value chain under one roof. The Group owns over 400 hotels and resorts with premium brands such as RIU, TUI Blue and Robinson and 16 cruise ships, ranging from the MS Europa and MS Europa 2 in the luxury class and expedition ships in the HANSEATIC class to the Mein Schiff fleet of TUI Cruises and cruise ships operated by Marella Cruises in the UK. The Group also includes Europe's leading tour operator brands and online marketing platforms, for example for hotel-only or flight-only offers, five airlines with more than 130 modern medium- and long-haul aircraft and around 1,200 travel agencies. In addition to expanding its core business with hotels and cruises via successful joint ventures and activities in vacation destinations, TUI is increasingly focusing on the expansion of digital platforms. The Group is transforming itself into a global tourism platform company.

Global responsibility for sustainable economic, environmental and social action is at the heart of our corporate culture. With projects in 25 countries, the TUI Care Foundation initiated by TUI focuses on the positive effects of tourism, on education and training and on strengthening environmental and social standards. In this way, it supports the development of vacation destinations. The globally active TUI Care Foundation initiates projects that create new opportunities for the next generation.

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