London
CNN
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TUI, one of the world's biggest travel agencies, is set to exit the London Stock Exchange in June, the latest blow to the British capital. It has a long-standing reputation as the undisputed leader of European stock markets.
Shareholders of the German company, which is dual-listed in London and Frankfurt, voted on Tuesday to delist the company. From the London Stock Exchange.
Tui said in December that he was considering the move because the bulk of trading in the company's shares had moved from Britain to Germany over the past four years. A standalone listing in Frankfurt would simplify the company's structure and reduce costs, the company said at the time.
“We are pleased that TUI's shareholders followed our recommendations and voted in favor of delisting,” Chief Financial Officer Matthias Kipp said in a statement.
The company plans to cancel its shares on the London Stock Exchange in late June.
The past 18 months have seen several companies move their primary listings to New York or choose Wall Street as their primary listing on the UK's main stock exchanges, most notably the UK technology sector. The crown jewel is ARM Holdings (ARM), a semiconductor manufacturer backed by Softbank.
Tui's resignation is unlikely to spark a similar fight over London's future. The company has lost just a fifth of its value since the start of the pandemic, when its share price slumped and fell off the blue-chip FTSE 100 stock index.
Still, the move to Frankfurt will serve as a reminder that London is no longer a unique destination for Europeans. A company that wants to grow and raise money from investors.
“The vote by Tui shareholders… is definitely a blow to the London market,” said Delphine Currie, a partner at law firm Reed Smith who advises companies on IPOs. “While some may argue that this move makes sense for Tui, it is yet another example of a high-profile company turning its back on London.”
The British capital is increasingly competing directly with neighboring countries such as Amsterdam and Paris for the position as Europe's largest stock trading center and most valuable stock market.
Headquartered in Hannover, Tui owns more than 400 hotels, 16 cruise ships, five airlines and 1,200 travel agencies. The group employs more than 60,000 staff, according to its website.
Also on Tuesday, the company announced its first-ever operating profit for the October-December period, when travel tends to be slow. Thanks to the ability to raise prices, sales in the same period rose 15% compared to the previous year, when they hit a record high of 4.3 billion euros ($4.6 billion). Thanks to sustained travel demand.
“It's not the best consumer environment we're in, but vacations are a priority everywhere you look,” Kipp told investors on a conference call.
Despite the Israel-Hamas war and related turmoil in the Middle East, Egypt remained one of Tui's most popular short-haul routes for customers, along with the Canary Islands and Cape Verde. Said. “Key long-haul destinations during the quarter included Mexico, Thailand and the Dominican Republic,” it added.
The company is diverting some cruise ships around South Africa's Cape of Good Hope to avoid attacks in the Red Sea by Yemen-based Houthi militants. “Despite the costs of converting cruise ships, we remain confident throughout the year,” Chief Executive Sebastian Ebel told investors. He said the additional cost of the conversion would be “in the low double digits”.
