(Bloomberg) -- TUI AG secured a 1.8 billion-euro ($2 billion) loan from state-run KfW bank, in one of the biggest bailouts in Germany so far.
The tour operator received approval from the German government, it said in a statement Friday. The funding will add to TUI's existing 1.75 billion-euro revolving credit facility.
With both loans, TUI will have a 3.1 billion-euro cushion against the effects of the coronavirus pandemic, which forced it to stop selling tours through the end of April after most countries enacted travel restrictions to fight the disease.
“We were economically successful before the crisis and will be again after the crisis,” Chief Executive Officer Fritz Joussen said in the statement. “However, we are currently facing unprecedented international travel restrictions. As a result, we are temporarily a company with no product and no revenue.”
The loan is subject to approval by TUI's lending banks, and the company will have to waive dividend payments for the duration of the loan.
Bloomberg News on Thursday reported that TUI, the world's biggest tour operator, was close to securing nearly 2 billion euros in government aid in what's seen as a litmus test for Germany's pledge to rescue businesses ravaged by the coronavirus pandemic.
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