Russian investor Alexey Mordashov has raised his stake in TUI, Europe's biggest travel and tourism group, to 3.02 percent, a statement said Monday, providing good news for its beleagured chief executive Michael Frenzel.
The increased stake is held via Mordashov's investment vehicle S-Group Capital Management, which said in a statement that "investment in TUI is a personal investment of Mr Mordashov and is considered as strategic."
Mordashov is head of the Russian steel company Severstal. "S-Group acts in full support of current management of TUI and current corporate strategy going forward," the statement said. Another major TUI shareholder, Guy Wyser-Pratte, has called for an extraordinary meeting to oppose the recent extension of Frenzel's contract.
He has been head of the group for 13 years, the longest term of any company listed on Frankfurt's Dax index, but has seen the group's shares lose around 10 percent of their value during that time.
The DAX 30 index, meanwhile, has gained around 250 percent. S-Group said Monday it supported TUI's strategy of improving profitability by offering more trips to regions such as eastern Europe and Russia and saw its increased stake as a "first step to establish strategic partnership between S-Group and TUI."
According to German regulations, investors are obliged to disclose when their holdings breach certain thresholds, including 3.0 percent, 5.0 percent and 10 percent.
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