TUI Travel PLC is pleased to announce it has signed an agreement to enter into a strategic venture with Intrepid Travel, one of the world's leading small group adventure tour operators. The proposal is to create a global leader in adventure travel, which will combine Intrepid Travel and TUI Travel PLC's international portfolio of adventure brands.

The transaction is based on an injection of businesses into the venture by both parties and has no cash component. The venture will be 60% owned by TUI Travel PLC and 40% owned by Intrepid Travel's private shareholders, and will be consolidated by TUI Travel PLC. The transaction is expected to drive cost synergies, primarily arising from increased economies of scale, of at least £10m per annum within the first three years. Completion is expected by May 2011.

Intrepid Travel, based in Melbourne, Australia, handles over 100,000 customers per annum, drawn from all the key adventure source markets in the world. For the financial year ended 30 June 2010 Intrepid Travel had revenues of £69.4 million and PBT of £5.3 million.

TUI Travel PLC's Adventure businesses are part of the Specialist & Activity Sector. They are a portfolio of market-leading adventure travel businesses based in the UK, Australia, North America and the Netherlands and have over 240,000 customers per annum. For the financial year ended 30 September 2010 they had revenues of £185.3 million and PBT of £6.8 million.

The combined businesses will operate a multi-channel and multi-brand strategy and will provide new opportunities for growth including new products, distribution channels, source markets and destinations.

Commenting on the announcement Peter Long, Chief Executive, TUI Travel PLC stated:

"Specialist travel is an important part of our business and one of our key drivers of growth due to strong margins and development opportunities. This deal with Intrepid Travel will significantly enhance our position in the fast growing adventure travel sector.  We believe this venture has great potential for value creation through the increased scale, synergies and growth of the combined businesses."

The Board of the venture will be chaired by John Wimbleton, Managing Director of TUI Travel PLC's Specialist & Activity Sector. Darrell Wade, CEO and co-founder of Intrepid Travel, will become CEO of the venture.