It has been a long time coming, but directors at TUI Travel have finally confirmed they are in discussions with TUI AG about a possible merger of the two organisations.
The larger German organisation already owns 56 per cent of TUI Travel, with a deal potentially seeing the organisation acquiring the outstanding stock.
In a statement earlier the independent directors of TUI Travel said: “TUI Travel has recently received an approach from TUI AG which may or may not result in a combination of the two companies.
“Discussions are at a very early stage, but are on the basis that any such combination, if effected, would be achieved not by a reverse takeover but by means of a nil premium all-share merger.”
It is thought a combination of the two companies could create synergies of over €500 million.
The statement added, in according with the City Code on Takeovers and Mergers, TUI AG is required to either announce a firm intention to make an offer for TUI Travel or announced that it does not intend to make an offer by 17:00 on February 13th.
Shares in TUI Travel rose by four per cent following the statement.