The crisis-torn travel group Thomas Cook offloaded a Spanish hotels and golf club business yesterday, as part of a drive to slash debts that threaten to engulf the 170-year-old company.
The move comes ahead of delayed annual results today which are expected to see the travel company announce a sweeping package of store closures and job cuts, and perhaps a new corporate strategy. It is selling its stake in Hoteles Y Clubs De Vacaciones – five hotels and a golf club – for €72.2m (£61m).
Because the firm holds debts of €22.4m, the transaction will ease its £1 billion debt predicament by €94.6m in all. It will still be able to book the hotels for its customers via a deal with new owner Iberostar.
Thomas Cook was thrown into crisis two weeks ago when the company delayed its results announcement, admitted present trading was awful and said it needed a cash injection from banks to survive.
It has since cut a deal that will get the travel operator through the tricky winter period and hopefully give it breathing space to regroup.
The company is without a permanent boss since ousting Manny Fontenla-Novoa in the summer. He had been paid £15m since 2007.
Thomas Cook employs 30,000 people, of whom 20,000 are in stores up and down the country.
Analysts expect it to shut at least 200 of its 1,100 travel shops and axe about 1,000 jobs. It could also unveil a move upmarket, an admission that its present offering is seen as out of date.
Sam Weihagen, the company's interim chief executive, said today's deal "demonstrates our ongoing commitment to strengthen the balance sheet".
The battered shares – they fell 70 per cent on the day Thomas Cook admitted to being in trouble – yesterday edged up 0.32p to 15.59p.