Welsh Water had planned to give the management of the hotels - which do not fit with its utilities business - to Resort Hotels. But the deal was abandoned when trading in Resort shares was suspended. The accountant Ernst & Young has since been called in to investigate its accounts.
Mr Branson's travel agent company Voyager is vying with Jarvis Hotels and another concern, thought to be Mount Charlotte Hotels, for the management contract.
Jarvis was a formed when John Jarvis, the former chief of Hilton International, led a buyout of Embassy Hotels from the food and drinks group Allied-Lyons.
It owns 43 hotels but has earned a reputation for managing hotels owned by banks or other institutions which have repossesed properties. Jarvis, a venture capital funded unquoted company, is also planning to float on the Stock Exchange.Reuse content