TUI AG (LON:TUI) shares rose as the tour operator secured a €1.8bn state aid bridging loan from the German government and cancelled holidays for the next five weeks due to coronavirus.
The Anglo-German group told customers on Wednesday that bookings for beach and cruise holidays from 14 May were being scrapped until at least June, having already suspended the majority of all travel operations last month.
“We are constantly monitoring the situation and will start taking people on holiday again as soon as we are able to do so,” a Tui spokeswoman said.
“At this point in time, nobody can accurately predict when that will be, so for the time being we will keep a close eye on our programme and continue to amend and adapt timings in line with the latest global travel advice.”
Meanwhile, the FTSE 250 group, said the new loan, part of the German state support programme, was coming from state-owned development bank KfW and was supported by TUI's current revolving borrowing facility.
TUI said it had decided to apply for the KfW loan “in order to cushion the unprecedented effects of the pandemic” after various countries imposed international travel restrictions.
It said the current financial year 2020 had started off with extremely strong bookings and that it was “a very healthy company that was economically successful before the crisis – it has a strong strategic positioning, structure and substance”.
TUI chief executive Fritz Joussen said: “The German Government has acted quickly to support jobs and companies during these exceptional times. We are now preparing intensively for when our operations can resume after the Coronavirus crisis and firmly believe, people will continue to want to travel and explore other countries and cultures in the future.”
Shares in the company were up 3% to 379p on Wednesday, where they are down 62% so far in 2020.