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Source: Sunday Times

Matthew Goodman and Dominic O’Connell

THE tour operator MyTravel has put its American assets up for sale in a move that could raise more than $300m (£185m).
The debt-laden company has hired Banc of America Securities to handle the sale. An information memorandum containing detailed
financial data on the business has been circulated to potential bidders in the past week. Interested parties have been told they
have up to 10 days in which to make indicative offers for the assets.

Banc of America Securities last year helped MyTravel to arrange and syndicate a £400m consumer-protection bond.

The travel group’s American operations had sales of £570m last year, providing holidays for 2.8m Americans and Canadians. The
division employs 2,900 people and boasts among its main businesses TSI, a cruise-holiday booking agency acquired in 2000, and Auto
Europe, a car-rental operation.

MyTravel, which had struggled to break into North America, paid $385m for TSI in 2000. It is unlikely to recoup its investment.
One source suggested it would sell for closer to $300m. MyTravel declined to comment.

The disclosure of the disposal plans is likely to be warmly received by the market, which has long expected MyTravel to sell its
North American operations as part of a fundraising drive to help reduce the company’s mountain of debt.

Last week MyTravel confirmed it was in negotiations with holders of its £215m worth of convertible bonds. They will be asked to
relinquish part of their debt, the maturity of which would be extended, in return for a 21% stake in the company. The bonds’ price
has risen from a low of 28p earlier this year to close last week at 60p.

Some shareholders are critical of the fees being paid to the company’s syndicate of banks in return for agreeing to extend the
terms of their loans. As part of an earlier restructuring, the banking syndicate controlling £1.3 billion worth of loans received
a 1% “amendment fee” and could get another £65m depending on the growth in the company’s market value.

Traders yesterday suggested that the company might attempt a rights issue later this year, but this was rejected last night by
company sources.