TUI Travel has announced its entry into the Russian travel market through a joint venture with oligarch Alexei Mordashov.
The group, which first announced plans to create a joint venture with the Russian billionaire’s S-Group Capital Management last April, said it had now signed a definitive agreement.Mordashov, who owns about 15 percent of TUI, will own 51 percent of the venture through his S-Group holding company. Hanover-based TUI, Europe’s largest tour operator, will control 49 percent.
The joint venture, which will be 51 percent owned by S-Group and 49 percent owned by TUI Travel, has agreed to acquire majority stakes in assets owned by two tour operators in Russia and Ukraine, TUI Travel said in a statement.
S-Group and TUI each will invest US$20 million in the venture this year, including the acquisitions of 75 percent of “certain assets” of Russian tour operator VKO Group and Ukrainian travel company Voyage Kiev and Moscow-based Mostravel, which specializes in trips to Turkey and Egypt, TUI said.
“TUI Travel will be the first major international tour operator with a significant presence in Russia,” said Chief Executive Peter Long.
“We are delighted with our partnership with S-Group which combines their local business knowledge and expertise with our vast experience in leisure travel.
“The agreements with VKO, Voyage Kiev and Mostravel will provide us with the scale and expertise to make a large impact on these markets.”
Vladimir Yakushev, managing partner, S-Group Capital Management said: “These deals start consolidating the market and will help to introduce market leading practices which will enable customers in Russia and Ukraine to enjoy high international tourism standards.”