Tui, Europe’s largest tour operator has dealt another blow to London’s shrinking equity markets after recommending that its UK listing be cancelled next month.
Anglo-German Travel Group, which has reported revenues of €20.7bn by 2023 and is listed both in London and Frankfurt at a valuation €3.5bn, announced on Thursday that, following investor pressure, they had decided their British listing was not “advantageous”.
In a recent statement, the board of Tui said that less than a quarter (24%) of shares were traded in London. They cited a “significant decrease” in liquidity in UK equity markets.
The Hanover-headquartered company has had a dual listing since 2014, and still counts British tourists as its single biggest group of customers.
“We have listened to the suggestions from our shareholders and held many discussions. The termination of the listing would provide clear benefits for both investors and the company,” stated chief financial officer Mathias Kiep.
In the last few months, London Stock Exchange has seen a constant flow of companies abandoning their current listings and choosing to list on rival exchanges. These losses have angered Conservative Members of Parliament keen to highlight London’s financial appeal following Brexit.
The chief executive of commodities group Glencore announced in November that the company will list its coal mining spin-off at New York even though natural resource companies are traditionally a strength of London.
Marex, a commodity broker in the US, filed in December to list in New York. Irish building materials company CRH, and packaging company Smurfit Kappa were among the companies last year that dropped their London listings.
Tui announced that it would propose the delisting in a formal manner at its annual general meeting on 13th February. To pass the resolution, it will need to have 75 percent of shareholder support.
The company said that if the removal from London is successful, it will take place in June.
Kiep said that the move would “[allow] for [the] simplification and improvement of liquidity and indexation, as well as benefits to EU ownership of our airline,”. To benefit from the single aviation market, airlines must be controlled and owned by EU entities.
After a thorough analysis and based on this, we recommend to our shareholders that they vote for the resolution proposed at the AGM.
Alexei Mordashov is the largest shareholder in Tui, with a stake of almost 11 percent. He is a Russian steel magnate. Mordashov is a Russian steel magnate who has been hit by EU and UK sanction over Russia’s invasion in Ukraine. He does not have access to his investments and therefore cannot vote.
Tui is expecting 2024 to be an excellent year for growth. The company presented the 2023 results last month. It said that it expected revenues to grow by 10 percent in the coming year.