# TUI launches convertible bonds offering

- Link: https://www.directorstalkinterviews.com/tui-launches-convertible-bonds-offering/412975454
- Published: 2021-04-09T07:29:05+01:00
- Author: Giles

The Management Board of **TUI AG** (LON:TUI) resolved today, with the consent of
the Supervisory Board, to launch an offering of senior unsecured bonds convertible
as per their terms and conditions due 2028 in an aggregate principal amount of approx.
€ 350 million with the option to increase the issuance volume to € 400 million. 
The Bonds will be convertible into new and/or existing no-par value ordinary registered
shares of TUI.

TUI intends to use the proceeds from the Offering to further improve its liquidity
position as the Covid-19 crisis continues and subsequently for the repayment of 
existing financing instruments.

The Bonds with a denomination of € 100,000 per Bond will be issued at 100% of their
principal amount. Unless previously converted, redeemed or repurchased and cancelled,
the Bonds will be redeemed at their principal amount on 16 April 2028. The Bonds
will be offered with a coupon between 4.50% and 5.00% per annum, payable semi-annually
in arrears. The initial conversion price will be set at a conversion premium between
25% and 30% above the reference share price (being the volume weighted average price(
VWAP) of the Shares on XETRA between launch and pricing of the Offering on 9 April
2021).

TUI may redeem all, but not some only, of the Bonds outstanding at their principal
amount plus accrued but unpaid interest at any time (i) on or after 7 May 2026 if
within a certain time period the parity value in respect of a Bond in the principal
amount of € 100,000 exceeds € 130,000, or (ii) if at any time the aggregate principal
amount of the Bonds outstanding and held by persons other than TUI and any of its
subsidiaries has fallen to 20% or less of the aggregate principal amount of the 
Bonds originally issued. Holders of the Bonds will be entitled to require an early
redemption of their Bonds at their principal amount plus accrued but unpaid interest
on the fifth anniversary of the Bonds’ issue.

The Bonds will be offered by way of an accelerated bookbuilding to institutional
investors outside the United States of America as well as outside of Australia, 
Japan, South Africa and any other jurisdiction in which offers or sales of the Bonds
would be prohibited by applicable law (the ‘Offering’). In Canada, the Offering 
will only be made in the provinces of Ontario, Québec, British Columbia or Alberta,
to institutional investors who are both an accredited investor and a Canadian permitted
client under applicable Canadian securities laws. The existing shareholders’ pre-
emptive rights (Bezugsrechte) to the Bonds will be excluded.

TUI has agreed not to offer any Shares or equity-linked securities within a period
of 60 calendar days after the settlement of the Offering, and not to enter into 
any transaction having a similar economic effect, subject to customary exemptions.

The final terms of the Bonds are expected to be determined and announced through
a separate press release later today. Settlement is expected to take place on or
around 16 April 2021. TUI intends to apply for the Convertible Bonds to be included
to trading on the unregulated Open Market Segment (Freiverkehr) of the Frankfurt
Stock Exchange.

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