UPDATE 1-Tui Travel replaces Pennon in UK FTSE rejig
* Tui Travel to join Britain's FTSE 100 in Dec. 24 reshuffle
* Pennon demoted to mid cap index
* Direct Line added to mid-caps after October listing
LONDON, Dec 12 (Reuters) - Shares in the world's largest tour operator, Tui Travel, will be promoted to the UK's top index in the latest reshuffle, replacing utilities group Pennon.
Pennon will take Tui's place on the mid-cap FTSE 250 index , with all changes due to become effective on Dec. 24, exchange operator FTSE said on Wednesday.
Tui's promotion to FTSE 100 status, which follows an 80 percent rally since June on the back of strong growth in travel bookings, is expected to attract demand for around 8 million of its shares from investors who track the UK benchmark, according to estimates by a European investment bank.
The bank estimates Pennon's demotion will result in around 5 million shares in the firm being sold.
Pennon's stock has fallen 22 percent in the past 3-1/2 months as the company's waste management business struggled with falling demand.
Britain's largest motor insurer, Direct Line, which went public in October and has yet to be included in any FTSE index, will join mid-caps, along with small caps pubs firm Enterprise Inns and pharma group United Drug.
They will replace oil & gas firm Ruspetro, Talvivara Mining Company and waste management firm Shanks Group .