GRANADA Group has sold Budget Travel to Thomson Holidays, a rival which arrived on the Irish market just eight months ago.

The purchase price is not being disclosed but travel trade source believe Budget Travel is valued a between £9 million and £10 million. This would put the joint managing directors, Ms Gillian Bowler and Mr Harry Sydner, in line to receive between £900,000 and £1 million for their 10 per cent minority stake.

Approval for the purchase has been granted by the Minister for Enterprise and Employment, Mr Bruton, though the combined holiday market share of the new group will be approximately 45 per cent - roughly the same as its major competitor, Falcon/ JWT Holidays.

Ms Bowler said it would be "daft" to abandon the policy which had made Budget Travel successful in the first place - offering good value holidays to consumers.

"The reason we succeeded is that we competed furiously every year. We are aggressive on price and that will continue," she said.

The takeover will not affect the 15 jobs at Thomson Holidays operation in Ireland, Ms Bowler said, though Thomson's manager in Ireland will be returning to Britain.

Mr Charles Newbold, managing director of Thomson Holidays, said the decision to buy Budget was taken because Thomson wishes to be the market leader in all its markets.

Thomson made a stormy entrance on the Irish market last winter, precipitating a price war and many claims and counter claims between tour operators, including Budget.

Ms Bowler and Mr Sydner said yesterday they were "particularly pleased that Thomson recognised the value of Budget following its entry into Ireland".

Mr Gerry Robinson, chairman of the Granada Group, said yesterday: "Budget Travel was a highly valued member of the Granada Group and our decision to sell was based solely on our strategy to focus on our core business activities."

Granada bought 90 per cent of Budget Travel in 1987 for £4.5 million.

Granada has other substantial business interests in Ireland, including Sutchffe, the catering company, and Spring Grove, the workwear and linen supplier, where Ms Bowler is chairman.

Granada's purchase of Forte Hotels has also given it ownership of a number of properties in Ireland, the best known of them being the Shelbourne Hotel in Dublin.

The market has speculated that Granada may also be a seller of hotels. Granada paid £3.7 billion for Forte Hotels and is seeking to reduce the debt it took on to make the takeover.

Mr John MacNeill, chief executive of Falcon/JWT Holidays, said yesterday he was not surprised by the announcement that Budget was being acquired by Thomson Holidays.

"We have been anticipating such a scenario and have been planning accordingly," he said.

Falcon paid £5.7 million for JWT Holidays last year at a time when its market share was thought to be between 15 per cent and 17 per cent. Mr MacNeill promised that competition in the holiday package market would remain as keen as ever.

However, a Fine Gael TD Mr Michael Creed (Cork North West), has called on the Competition Authority to investigate whether the Thomson purchase is a healthy development for the consumer.

"A few months ago, they were at one another's throats" Mr Creed told The Irish Times. "Now they're cosying up to one another."

Mr Creed said he was not attempting to second guess either the Minister or his advisers in the Department, who had given clearance.

"Two months ago, the Oireachtas in its wisdom passed legislation giving independence to the Competition Authority. All I'm saying is that it should now exercise that independence".

Mr Creed said the takeover of Budget left just two dominant operators in the Irish market, which would lead to an unhealthy market concentration and less competition on package holidays. Mr Creed said that a recent investigation of the Statoil takeover of Jet led to the imposition of strict conditions on the company.

"Concern for consumers and their rights... must be of paramount importance, whether they are buying a foreign holiday or a tank of petrol," Mr Creed said.