TUI Sells Hapag-Lloyd Cruises to its JV With Royal Caribbean
TUI Cruises, a 50-50 joint venture owned by German tourism conglomerate TUI AG and Royal Caribbean Cruises, has acquired the TUI AG subsidiary Hapag-Lloyd Cruises. The deal, valued at $1.3 billion, effectively puts all of TUI AG's cruise operations under one roof with a 50 percent stake for Royal Caribbean.
Hapag-Lloyd Cruises specializes in the German-speaking luxury and expedition cruise segment, and TUI Cruises focuses on the German premium cruise market. According to TUI AG, the sale of Hapag-Lloyd Cruises to the joint venture entity "combines the shipbuilding, operational and digital expertise of Royal Caribbean and the strong brand and distribution power of TUI."
Hapag-Lloyd Cruises' fleet consists of two high end luxury ships and three expedition cruise ships. A further expedition cruise ship has been ordered and will be added to the fleet in 2021 to replace the vessel Bremen, which is being sold to Swiss operator Scylla.
With the sale of Hapag-Lloyd Cruises, TUI expects that its luxury and expedition fleet will grow in the coming years, as it is projected that the demand for luxury and expedition cruises will continue to expand. While the ownership structure is changing, TUI says that the Hapag-Lloyd Cruises brand will not. “The ships’ identities, service, quality and customer experience will remain as individual and unique as they are today. This will create significant advantages for the group, for our expansion and for our investments,” said TUI CEO Fritz Joussen in a statement.
Joussen framed the expanded joint venture with Royal Caribbean as an opportunity for TUI to grow its cruise business internationally while taking a "capital-light" approach to investment. For Royal Caribbean, it offers a strengthened German market portfolio to compete with Carnival Corporation's AIDA brand.