Tui dealt a blow to the City yesterday as it said it might ditch its London listing,
Shareholders approached the travel operator about delisting from the London Stock Exchange (LSE) and upgrading to a premium listing in Germany.
It is the latest knockback for the LSE which has seen a flurry of companies quitting the exchange this year.
Tui, which is based in Hanover and holds a dual listing in London and Germany, is considering a shareholder vote on the issue in February.
A spokesman for the company said: ‘Tui has recently been approached by certain shareholders to discuss and understand whether the current listing structure is optimal and advantageous and if the simplification of the listing structures and an inclusion in the MDAX [which lists German companies trading on the Frankfurt Stock Exchange] would be beneficial.’
Up in the air: Tui, which is based in Hanover and holds a dual listing in London and Germany, announced it might ditch its London listing
At least 75 per cent of votes cast would need to be in favour of the move for it to be approved.
Tui, which is listed on the FTSE 250, said most of its shares are owned and traded in Frankfurt, a trend that has accelerated over the last four years.
Potential advantages of moving included reducing costs and boosting the stock’s profile with an expected prominent position on Frankfurt’s MDAX 50 index, the Tui spokesman said.
‘The executive board’s focus is to provide an attractive long-term listing for Tui which aligns with its ownership and current liquidity and delivers benefit to all shareholders,’ they added.
The holiday firm is the latest to consider leaving London or launching a secondary listing on another exchange.
Building materials group CRH, which had been a member of the FTSE 100, and Irish construction firm Kingspan both delisted earlier this year.
Smurfit Kappa will ditch its main listing in London after it completes a tie-up with US packaging giant West Rock.
Gambling giant Flutter completed a secondary listing in New York earlier this year and both polling firm You Gov and trading platform Plus 500 have said they are considering exiting the UK market.
London has also struggled with a lack of initial public offerings (IPOs) this year and has suffered high-profile snubs such as chip designer Arm’s decision to float in New York.
Victoria Scholar, head of investment at Interactive Investor, said: ‘This would be a major blow to the LSE which has been grappling with an exodus of companies as well as the weak performance for London-listed stocks.’
Russ Mould, investment director at AJ Bell, said: ‘You can see the company’s reasoning, as it feels there is more trade struck through Frankfurt and it reports its numbers in euros for good measure.’
But he added: ‘Management teams should be in the business of managing the assets to best effect and getting the best, risk-adjusted returns, not managing the share price. If they do the former properly, the latter should take care of itself over time.’
Tui said annual earnings more than doubled in the year ended September 30 due to record sales and rising prices. Profit hit £836.7million as revenue reached an all-time high of £17.7billion.
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