Bank-led group eyes TUI's shipping unit-source

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

18 Mar 2008

A bank-led investor group, which includes a majority owner of Kuehne & Nagel, is mulling a bid for TUI's shipping business, a source familiar with the matter said. The source said no offer has been made, adding that Klaus-Michael Kuehne, who controls Swiss logistics company Kuehne & Nagel could participate.A TUI spokesman repeated that the company would consider strategic options for the group at a supervisory board meeting on Monday, and declined further details.Analysts value Hapag-Lloyd, with around 140 container ships, at 4.2 billion to 4.6 billion euros ($6.6 billion-$7.2 billion). By comparison, Singapore's Neptune Orient Lines, rumoured to be interested in Hapag-Lloyd, has 120 container ships and an enterprise value of S$4.6 billion ($3 billion).Separately, German newspaper Welt am Sonntag reported that TUI investor Alexei Mordashov plans to boost his stake in the company to at least 10 percent.The Russian steel tycoon owns 5 percent of TUI's shares through private investment vehicle S-Group Capital Management.The newspaper quoted banking sources as saying Mordashov would also join TUI's supervisory board, adding that the Russian should help form the company into a tourism group.TUI shares rose this week on growing speculation that Chief Executive Michael Frenzel will bow to shareholder pressure and split up the tourism and shipping firm.  Frenzel, the architect and dogged supporter of TUI's twin-pillar strategy of tourism and shipping, in January proposed fully merging container shipping unit Hapag-Lloyd with the parent to prevent a break-up of the group.But major shareholders lambasted the plan.Investors have said it remained to be seen whether TUI, which also owns 51 percent of TUI Travel Plc, Europe's biggest tourism company, would merge Hapag-Lloyd, the world's fifth-largest container shipping company, with another container group or sell it.