Satisfied by the significantly higher demand for its sustainability-related bond, the TUI tourism group decided to place €500 million, instead of €300 million, which was the original offer to institutional investors.
The company, which will soon return to the MDAX, intends to use the proceeds to repay its debt and cover the costs associated with the bond.
As stated in the announcement, TUI AG has successfully placed a sustainability-linked bond. Due to strong investor demand, the initial offer was increased by EUR 200 million. The bond, which has a five-year term, now has a total volume of EUR 500 million instead of the planned EUR 300 million.
The bond has an annual interest rate of 5.875% and is issued at an interest rate of 98.93%. The interest on the bond is linked to the achievement of a specific sustainability target, the reduction of carbon dioxide emissions of the TUI group airlines.
In particular, the CO2 per passenger-kilometre ratio must be reduced by at least 11% by the end of the 2026 financial year (30 September 2026), compared to the financial year ended 30 September 2019.
If this target is not met, the annual bond rate will increase by 25 points for the remainder of the period.
