TUI in Billion-Dollar Deal for CP Ships | Business| Economy and finance news from a German perspective | DW | 22.08.2005
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TUI in Billion-Dollar Deal for CP Ships

TUI, which owns the Hapag-Lloyd shipping line, said over the weekend it had agreed a 1.7-billion-euro ($2 billion) deal to buy CP Ships, a freight shipping giant spun off from the Canadian Pacific conglomerate a few years ago. Following negative assessments from analysts, TUI's shares fell by more than 3 percent on Germany's DAX on Monday morning. Under the terms of the deal, TUI would pay $21.50 a share for CP Ships -- 10 percent above CP Ships' closing price on the Toronto Stock Exchange on Friday. TUI would assume 261 million euros in debt. The company said it would finance the purchase through bank loans and the sale of 1 billion euros in shares to current stockholders. Upon completion of the deal, Hapag-Lloyd would be the world's fifth-largest container line.

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