CNG Travel Group suspends chief executive

CNG Travel Group, the quoted online hotel booker which last week warned that poor performance had hit its earnings, has suspended its chief executive, Finbarr Power.

Mr Power founded the company and led it to flotation on the London Stock Exchange's Alternative Investment Market (Aim) last year.

Nobody from CNG was available for comment last night.

A source familiar with the situation speculated that the company was planning some management changes. The company is expected to issue a statement at its annual general meeting (agm), which is scheduled for today.

Last week, CNG warned that poor performances in two of its businesses would dent earnings this year. The company share price fell by around 15 per cent on the warning to around 30p.

The group announced that it plans to sell its leisure business, Places To Stay, a US firm which it bought last August for €10 million, because the company is losing money. CNG bought it last year from US group World Res. At the time, it said it expected the acquisition to boost earnings in its first year of operation. It paid cash for the business.

The statement added that CNG's proprietary technology, Travel Lodging Connector, was also a loss maker.

Its US business, Tzell, is continuing to trade profitably.

Following its flotation early last year, Mr Power was left with a 12.09 per cent shareholding in the group. Its other shareholders include Anglo Irish Trust, which has 13 per cent, and Menolly Homes, the house building company controlled by developer Séamus Ross, which has 11.8 per cent.

Mr Ross's son, Séamus Ross junior, is a member of the board, as is Dr Michael Smurfit, who holds 4.6 per cent of the company.

CNG Travel Group is chaired by Luke Mooney, a partner in corporate finance firm Corporate Finance Ireland.

CNG locates and books hotels, mainly for business travellers, both through its own website and by acting as the accommodation agent on sites operated by airlines and tour operators. It also licenses its technology to travel agents.

It is based in Kenmare, Co Kerry, and made a loss of $5.6 million (€4.6 million) on a turnover of $55.5 million in the year to end December 2004.