TUI Travel to cancel 10 of 23 787 orders

TUI Travel said yesterday that it has engaged "in extensive discussions with Boeing" regarding its 787 order book and "both parties" have agreed that 10 of its 23 firm orders will be cancelled while 13 purchase rights will be added.

"This optimizes the flexibility around our long-haul capacity," TUI said in a statement, adding that it now expects to take delivery of its first Dreamliner in "early 2012." Manchester-based First Choice Airways, part of Thomson Airways following the 2007 merger of TUI's travel division with First Choice Holidays, originally was due to receive its first 787 in February 2009 and later postponed first delivery to March 2011 (ATWOnline, March 16).

TUI Travel additionally announced a number of financing measures that will enable it to refinance its £900 million ($1.43 billion) shareholder loan with TUI AG, which owns a 51.6% stake in the tour operator. The measures include raising approximately £440 million through issuance of a convertible bond and additional bank facilities.

"The financing measures. . .allow us to commence repayment of our shareholder loan in a proactive manner and will also allow us to continue to take advantage of attractive [merger and acquisition] opportunities," CEO Peter Long said.

The TUI Travel cancellations will bring the number of axed Dreamliner orders this year to 83. Boeing maintains that the delayed program's first flight "is expected" by year end (ATWOnline, Sept. 25).