Tui Group has ended months of speculation by announcing its intention to sell off its Specialist Group.
In a half-year trading update issued to the City this morning , Tui chief executive Fritz Joussen said the group was a profitable portfolio of specialist travel businesses led by strong management teams.
It is expected the deal will be completed some time between September and April and the sale will be led by chief executive of Tui Group Will Waggott.
The Specialist Group consists of more than 50 brands including the Specialist Holidays Group and a number of adventure, education and sports events operators, and Tui’s intention is to sell it as one. The travel giant said there was limited linkage to the firm’s content strategy and little vertical integration with Specialist Group, hence the decision to sell it off.
Crystal Ski and Thomson Lakes and Mountains are exempted from the disposal and will be integrated into Tui’s mainstream business under UK and Ireland managing director Nick Longman.
In 2014, former Tui Travel plc chief financial officer and commercial director Waggott took control of SHG when he was appointed chief executive of the Tui AG non-mainstream division.
Since the creation of the mainstream division following the merger of Tui Travel and Tui AG it has been speculated that the firm would sell its specialist brands. It would only confirm they were being “managed for value”.
Asked about speculation that SHG was to be sold off at a Travel Weekly Business Breakfast last year Christine Franks, head of M&A at Tui, said it was in no rush.
She said: “It’s a huge portfolio of brands, and some of those are highly integrated into our mainstream business. Some are performing really well, some are underperforming.
“What we need to establish now is how to turn some of those businesses around and whether we are going to sell them or keep them in a group. We are not in a hurry.”
SHG was established when several businesses within Tui were brought together.
The group has UK headquarters in Crawley and Surbiton as well as is Dublin, Aarhus, Denmark; Clearwater, Florida; and Castelnaudary in France, and operates in 23 source markets and sells around 750,000 holidays a year.
While SHG has numerous brands, some of which are currently defunct, it is best known in the UK for Austravel, Citalia, Hayes & Jarvis and Sovereign.
The Specialist Group also includes Sunsail, Le Boat and The Moorings, as well as American Holidays, which primarily sells in Ireland, and Marco Polo and My Planet which sells in Denmark and Sweden.
In October last year, SHG launched trade-only Travelmood as it sought to court independent and third party agents into booking.
In October last year the group closed Meon Villas and in March confirmed the sale of the brand to Oliver’s Travels.
Last week Tui confirmed the sale of its global bed bank Hotelbeds, that was in its Specialist Travel division, to GNVA Acquisitions Limited for €1.191 billion in cash.
This story was updated at 11.04am to clarify the structure of the Specialist Group.
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