How Preussag Became TUI: A Clinical Study of Institutional Blockholders and Restructuring in Europe


  • This is an academic study and was written only to make a contribution to the scientific debate on corporate governance. The authors did not conduct the study on behalf of a third party and none of the authors received any funds from any party mentioned in this paper. We also did not receive any information or communications from Preussag's management. We are grateful to Michel Habib, Martin Wallmeier, an anonymous referee, and the jury members of the JFE ECGI Clinical Paper Competition, especially Steve Kaplan and Claudio Loderer, for their comments. Christoph Schneider acknowledges the support of a DekaBank scholarship.


Between 1997 and 2004, Preussag, a diversified German conglomerate of “old economy” businesses, transformed itself into TUI, a company focused almost entirely on tourism and logistics. We analyze how Preussag executed this change, and how the change contributed to Preussag's underperformance in the stock market. We find that only the divestitures created value, that the strategy to invest in tourism destroyed value, and that the acquisition premiums Preussag paid were mostly unjustified. The case shows how divestiture programs increase the liquid resources available to management and casts doubt on the positive governance role of institutional blockholders.