Thomas Cook sells Spanish chain for £61m

Travel firm Thomas Cook has sold Spanish hotel chain Hotels Y Clubs De Vacaciones (ICV) to Grupo Iberostar for 72.2m euros ($95.4m; £61m).

It comes as the world's oldest travel agency looks to cut its debts.

As HCV is being sold with net debt of 22.4m euros, it will cut Cook's net debt by 94.6m euros.

Thomas Cook is looking to restore the confidence of tourists and investors. Last month it secured £200m of new financing.

Its lenders, including Barclays, HSBC, RBS and UniCredit, agreed to provide the new facility until 30 April 2013.

After the Spanish deal was announced, the firm's chief executive, Sam Weihagen, said: "We have been able to agree this transaction which will significantly reduce Thomas Cook's net debt and demonstrate our ongoing commitment to strengthen the balance sheet."

Shares in the company initially fell 75% on one day in November after it said it was in talks about increasing borrowings.

Thomas Cook had blamed unrest in Egypt and Tunisia and floods in Thailand, all key destinations, for hitting sales.