Mytravel's hotel portfolio in Majorca is one of the troubled tour firm's main attractions as rival holiday companies stand by to pounce on any spare hotel capacity if Britain's largest tour operator is pushed into bankruptcy. A £50 million black hole in the company's accounts and the failure to shift one million summer holidays has left the tour operator, formerly knows as Airtours, facing an uncertain future, MyTravel shares ended the week as low as 18p. Founder and chairman David Crossland has a tough week ahead trying to save and stabilise the company, currently worth £89 million. A North American consortium is believed to be on the prowl with a £400 million bid, but the Americans are proving to be stalking horses, any move by the consortium will force First Choice, a target for a £850 million bid from Airtours in 1999, to fight. But it is understood that TUI, the German holiday company which owns Thomson Holidays, has joined the pack of interested tour operators closely watching MyTravel's financial position. MyTravel offers a highly attractive client base. Last year it carried 15 million customers, but also the operator has some valuable property portfolios in strategically important holiday destinations, such as Majorca. The tour firm, once the largest in the world, has a number of long term contracts with hoteliers in the Balearics, as well as owning one of Europe's largest resorts, the Bellevue in Alcudia, which is worth its weight in gold because of the local building freeze. Furthermore, not only are competitors eyeing hotel capacity, tour firms are ready to accommodate any clients who were planning to book with MyTravel but have decided to travel with any firm, despite assurance on Friday night from MyTravel that present and future customers have nothing to fear. Apart from the black hole, Crossland, who was due to retire next month, found, industry sources have said that MyTravel was slow to react to September 11. In response to the attacks on the United States, the big tour operators immediately decided to reduce capacity to account for the obvious reduction in travellers. For example, in the Balearics, capacity was reduced by around 18 per cent for this summer, but MyTravel reacted too late, hence why at one point they still had a reported 1.5 million summer package holidays to sell. Despite slashing package prices, MyTravel was unable to shift those holidays, while competitors managed to reduce operating costs and limit the damage. This week we will see how much damage has been done to MyTravel.


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