TUI has secured a third bailout, striking a deal with the German government, private investors and banks for an extra €1.8 billion as the world's largest holiday company tries to ride out the Covid-linked travel slump.
London-listed TUI has already received €3 billion in state loans this year.
The latest government aid has prompted calls from opposition lawmakers for Berlin to ensure that it came with strings attached.
TUI, which last year took 23 million people on holiday, lost €1.1 billion in the second quarter after the Covid-19 pandemic brought global travel to a halt.
The travel slump has wiped out TUI's revenue and strained its balance sheet as it burned through between €550-650m a month.
TUI's largest shareholder, Russian billionaire Alexey Mordashov, who owns 25% of the company, said he is expanding his investment as part of the capital measures.
Mordashov's stake will increase to 36% if he gets an exemption from financial watchdog Bafin from making a mandatory takeover offer. Otherwise, he will hike it to 29.9%.
Including the new rescue package, TUI now has €2.5 billion as of the end of November, its chief executive Fritz Joussen said, adding that TUI was healthy before the crisis and now has the funds to prepare for life after the pandemic.
The package comes with a ban on management bonuses and dividends, a German economy ministry spokeswoman said.
However, budget lawmaker Sven-Christian Kindler from the opposition Greens called on the government to include strict rules on climate and job protection into the package.
"The federal government must not repeat the same mistakes it made with the Lufthansa rescue deal," Kindler said, referring to a bailout of Germany's flagship airline in June.
The new TUI rescue package includes a €500m capital increase with subscription rights and a €420m so-called silent participation from Germany's economic support fund WSF, which can be converted into equity at any time.
It also includes a non-convertible equity hybrid from WSF worth €280m, a state guarantee of €400m, an extra €200m credit facility from state bank KfW and the extension of an existing KfW facility to July 2022.
The nominal price of TUI's shares will be reduced to €1 euro from €2.56, followed by a rights issues of €509m new shares, which shareholders still need to sign off at an extraordinary general meeting in January.