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Tui plans to buy hotels and ships with sale proceeds

The Tui Group will use funds from the sale of its Specialist Group to acquire more hotel and cruise assets. Fritz Joussen, Tui chief

as it eyes more assets

“There are some brands that need a turnaround, but none that we want to close”

to vacate the Specialist Group building and move elsewhere in Surbiton, Waggott replied: “That’s all still to be worked through but, potentially, they could still have a floor within our building.” Waggott confirmed that the

next step for Travelopia, which employs 5,000 people around the world, was to unpick ski from the Specialist Group, which he described as “a big piece of work”.

Sale process

Confirming he expected the sale process and bidding to begin in the autumn, he said: “We have a lot to do to prepare for sale. We have to put together a three to five-year plan to show potential investors.” Waggott said it was Travelopia’s intention to be sold as one unit. “It

is absolutely not our preference to split it up because if there is any suggestion that you might break it up, that’s when you start losing the management team. We are planning for one transaction.” Waggott, Froggatt and Prior will remain with Travelopia.

Potential suitors “It could be a trade sale but I think it’s unlikely. However, we will not stop any trade buyers putting in bids as that will drive the price up for Tui Group.” Waggott would not comment on

the value of the Specialist Group. Froggatt added that the winning

bid would be from the backer who wanted to commit significant funds to expand the company. Waggott admitted that some of

the brands needed more support than others. “There are some that need a turnaround, but there are none in the portfolio that we want to close or dump,” he said. Froggatt added: “When you’re a

plc, it’s very difficult to invest for profit because you have to deliver

a number every year. With new owners we will be able to have a longer-term view and invest upfront for a return maybe five to seven years down the line.”

Travelopia logic

Waggott said: “We have given the business a new name because it is our intention to sell it and it needs some sort of identity and home. “It would be weird selling a business that is called the specialist division of Tui Group; hence, we’ve come up with Travelopia, which we think is a pretty nice name for a collection of really incredible products offering amazing experiences,” said Waggott. Prior confirmed that Travelopia

was not a B2C brand and would not be marketed to consumers. “It will stand for the home of

niche specialist travel brands. It helps staff to have an umbrella company, as it reassures them that whatever brand they work for, they

all have the same values,” he said. › Talk Back, page 21 › Comment, page 32

Fritz Joussen

executive, confirmed the plan to acquire further assets after revealing his intention to sell the Specialist Group. Announcing the start of the Specialist Group sale process, Joussen told analysts: “We are a growth company. We are not just about selling off stuff. “We will talk about what we will spend the money on in our annual results in December. For now we focus on trading.” Asked if this would mean

the acquisition of more hotels and cruise ships, Joussen told Travel Weekly: “Absolutely. We will become more and more content centric.” Joussen said the group’s own

hotels and cruise ships contribute “20% or more” to group profits “and this percentage will grow”. Tui announced the €1.2 billion sale of accommodation wholesaler Hotelbeds in April. The Specialist Group has about 50 brands. “They are brilliant brands: look at Hayes & Jarvis, look at Sunsail – brands for sailing, for Africa, for adventure,” said Joussen. “[But] they don’t use our Tui

brand, they don’t use our IT, they don’t use our hotels, they don’t use our ships, they don’t use our airlines. It is not important that we are the owner.”

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