The largest individual shareholder of TUI, the German tourism and shipping group, is demanding that chief executive Michael Frenzel is removed because of alleged special agreements with other shareholders, according to reports in a German newspaper.

John Fredriksen, a Norwegian billionaire who holds a 15 per cent stake in the German travel operator that owns First Choice and Thomson holidays, made his demands in a letter to the company, according to the Handelsblatt newspaper.

"We want to make clear that we see Frenzel as intolerable," he said, adding: "We believe that extensive changes in this company's management are necessary."

Mr Fredriksen is reported to have alleged that there may be special agreements with other shareholders, in particular the Spanish hotel chain RIU, which holds a 5 per cent stake in TUI, and Egyptian investor Hamel el Chiaty, who is thought to hold a 3 per cent stake in the company. He suggests that both stakeholders have guaranteed the right to buy hotels from the German company at a discount if the company's shareholder structure changes.

A spokesman for TUI admitted that though there is a so-called "change-of-control" clause in agreements between TUI and RIU, an audit report ensures that the Spanish company cannot pay less than market value for hotels.

Yesterday, Mr Fredriksen raised his stake yesterday in TUI, to 15.01 per cent. He became TUI’s major investor in April, overtaking the Russian steel billionaire Alexei Mordashov.

Mr Fredriksen also wanted the company to explain a clause in Mr Frenzel’s contract which he described as "highly unusual and potentially illegal,” that apparently says that the chief executive can ask to have his five-year contract paid out in cash, if supervisory board chairman Juergen Krumnow steps down or is replaced.

According to reports, TUI said this clause applies to all management board members and has been in place since 2003, before Mr Krumnow replaced former chairman Friedel Neuber.

TUI is the parent company of TUI Travel, which was created last year following a merger between the German operator and First Choice holidays, creating a £3.5 billion company.

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