The Riu family is taking over Tui’s 49% stake in a jointly held portfolio of 19 hotels and two properties in development.
The transaction between the Spanish hotel group and Tui will have a total value of €670 million.
Tui said it will use the proceeds to reduce the debt that has grown during the pandemic.
The Riu family already holds a 51% stake in these 21 properties – operated under the Riu Hotels & Resorts brand – and will now become the sole owner.
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Riu and Tui continue to have a 50:50 joint venture with 100 hotels and resorts worldwide.
This joint venture will continue to manage and distribute all Riu hotels and resorts worldwide – including the 21 properties that will be fully owned by the Riu family in the future.
Tui said the sale means it is “strengthening its core business with holiday experiences”.
“The group intends to grow primarily with its international hotel brands Tui Blue, Riu, Robinson, Tui Magic Life and the management of these hotels, but in doing so will tie up less capital in land and its own real estate in the future,” it said.
Peter Krueger, chief strategy and M&A officer responsible for Tui Group’s hotel investments, said: “We are separating hotel management and the holiday experience from property ownership, in line with our strategy announced in 2019 pre-crisis, a business model that has proven successful in the international city hotel sector.
“For the customer experience, it’s all about the brand and quality of the hotel rather than ownership of the real estate.”
The international Riu chain was founded in Mallorca by the Riu family in 1953 as a small holiday firm and is still owned by the family’s third generation.