Thomas Cook has announced it will sell its interest in Hoteles Y Clubs De Vacaciones (HCV) to hotel operator Grupo Iberostar. 

HCV is a holding company that, together with another shareholder, indirectly owns five Spanish hotels and one golf club as well as operating a second golf club in Spain.

The sale of HCV is part of Thomas Cook’s disposal programme announced earlier this year, which has targeted selling up to £200 million of non-core assets over a six to eighteen month period.

Thomas Cook will continue to benefit from access to HCV’s hotel portfolio through a separate commercial arrangement that has been agreed with IBS.

Sam Weihagen, group chief executive, Thomas Cook, said: “I am delighted that 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. 

“Importantly for our customers, we have been able to maintain access to this popular portfolio of hotels through a commercial arrangement with our partner Grupo Iberostar.”

Under the terms agreed with IBS, Thomas Cook will receive cash proceeds of €72.2 million from the transaction.

HCV is being sold with net debt of €22.4 million, so the transaction will reduce Thomas Cook’s net debt by €94.6 million, which equates to approximately £81 million at current exchange rates.

The proceeds of the sale of HCV will be used to reduce Thomas Cook’s borrowings.

Completion is conditional upon shareholder approval.