TUI Group - TUI Travel upgrades synergy potential / Plans to merge Germanwings, Eurowings and TUIfly

TUI Travel PLC, a TUI AG group company, today publishes the results of the 100-day-review by CEO Peter Long in London and provides an update on details of its further strategy. According to this update, excellent progress has been achieved on the integration of the business of First Choice Holidays PLC and TUI’s tourism division under the newly formed TUI Travel. As a result, TUI Travel has upgraded the expected synergies from an initial 100 million pound sterling to now 150 million pound sterling per annum. The synergies are expected to be fully effective by the end of the 2010 financial year. The additional synergy benefit will be realised in the UK and in continental Europe as well as a number of central functions. It is now expected that the restructuring costs associated with the delivery of the synergies will amount to 180 million pound sterling. The identified synergies and further underlying margin opportunity in the Mainstream Holidays as well as in the Specialist sector will facilitate a significant increase in the operating margin going forward.

In addition, TUI Travel PLC has today signed a Memorandum of Understanding with Deutsche Lufthansa AG and Albrecht Knauf Industriebeteiligung GmbH, allowing the parties to proceed with plans to merge their subsidiaries Hapag-Lloyd Fluggesellschaft GmbH, Hapag-Lloyd Express GmbH, Germanwings GmbH and Eurowings Luftverkehrs AG under a joint and independent holding company. The prerequisites for the conclusion of legally binding agreements will be a due diligence process and negotiations of the specific details. The merger will require approval by the relevant bodies of the companies involved and by the anti-trust authorities.

Hanover, 29 January 2008
- The Executive Board -

Address:

TUI AG
Karl-Wiechert-Allee 4
30625 Hanover
Germany

List of exchanges where stock is listed:

Berlin/Bremen, Düsseldorf, Frankfurt, Hamburg, Hanover, Munich, Stuttgart

International security identification number (ISIN):

DE000TUAG000
DE0003659884
DE0002913894
XS0191794782
XS0191795672
XS0195307367
DE000TUAG059
XS0237431837
XS0237433700
XS0237435317
XS0237436711

More detailed information is available at www.tuitravelplc.com. This press release is also available at www.tui-group.com.

End of the ad-hoc-statement

If we comment on forecasts or expectations in this announcement or if our statements relate to the future, these statements may be associated with known and unknown risks and uncertainties. Actual outcomes and developments may, therefore, deviate significantly from the expressed expectations and assumptions. In addition, the performance of financial markets and exchange rates as well as national and international law amendments, particularly with regard to tax regulations, may have an influence. Except as provided by law, the company assumes no obligation to update future statements.

TUI Travel upgrades synergy potential / Plans to merge Germanwings, Eurowings and TUIfly

Ad-hoc-statement in accordance with section 15 of the German Securities Trading Act (WpHG German Stock Exchange Act)