TUI AG, a leading German travel operator listed on the London Stock Exchange, has confirmed its intention to seek shareholder approval for delisting its shares from the London exchange. Instead, TUI plans to make Frankfurt its primary exchange. This move follows a growing trend of companies choosing to leave the London Stock Exchange.
In December, TUI first mentioned this plan in conjunction with its fiscal 2023 earnings report. The company stated that it will present proposals to simplify its listing structure at its upcoming annual general meeting. As part of these proposals, TUI aims to upgrade its listing in Germany to Frankfurt's prime standard market segment.
If shareholders approve the plan on February 13th, TUI expects its shares to officially delist from the London Stock Exchange in June. The transition to Frankfurt's prime standard market is anticipated to occur around April 8th.
TUI decided to review the advantages of a simplified listing structure following requests from some shareholders. The company revealed that approximately 77% of trading in its shares takes place directly via the German share register, with less than a quarter occurring through U.K. depositary interests.
Termination of London Listing: Advantages for Investors and Company
The termination of the company's listing in London is expected to bring about several advantages for both investors and the organization itself. Chief Financial Officer Mathias Kiep expressed that this move would lead to a simplification of structures, improved liquidity, indexation, and various benefits for the European Union's ownership of their airlines.
After conducting extensive analysis, it is recommended that shareholders vote in favor of the proposed resolution during the upcoming annual general meeting.
Impact on London Stock Exchange
The delisting plan represents a significant setback for the London Stock Exchange, as several prominent companies have recently opted to switch their listings to New York. One such example is CRH, an Irish building-materials supplier traded on London's FTSE 100 index, which shifted its primary listing to New York in September. Flutter Entertainment, the parent company of renowned brands such as FanDuel, PokerStars, and Paddy Power, is also planning a move to the U.S. Additionally, British chip maker Arm Holdings decided to make its stock market return in New York rather than London.
No Immediate Response from London Stock Exchange
When approached for comment by Dow Jones Newswires, the London Stock Exchange did not offer an immediate response.
Current Market Conditions
As of 1537 GMT, the company's shares witnessed a decline of 3.0 pence, equivalent to a 0.7% decrease, settling at 603.50 pence. This puts the company's market capitalization at approximately 3.06 billion pounds ($3.88 billion). Over the past 12 months, the shares have dipped by 22%.
