CRISIS-hit holiday group MyTravel insisted customers could have confidence in the business today as it sought to recover from the worst week in its history.

The tour operator, previously Airtours and which employes hundreds of people in Rossendale and Accrington, said it was both profitable and "fully compliant" with obligations under its credit facilities in a bid to cool frenzied speculation over its future.

Issuing a statement at the Association of British Travel Agents' convention in Cairo, the group added that it had received overwhelming support from travel agents.

The move came as reports suggested executive directors of the group, were already in talks aimed at securing a friendly takeover.

Venture-capital groups 3i, CVC and Permira are said to have been sounded out over a possible £750 million agreed deal.

And speculation continued to rage over whether MyTravel could cope with the burden of debts and liabilities estimated to total some £1.5 billion.

Analysts on Friday said a looming threat for the group was a £400 million bond it has to place with the Civil Aviation Authority to protect holidaymakers.

MyTravel's fortunes have nosedived after a shock profits warning last Thursday, the third in five months and the second in just 18 days.

The group saw its shares tumble after cutting its profits targets by another £20 million and warning of a potential £30 million accounting charge.

Chairman David Crossland has so far refused to speak to the press since the warning.

A spokeswoman today would not comment on whether the group was in takeover talks and stuck to the group's statement, given out to delegates in Cairo.

It said: "MyTravel is a large and profitable group. It has committed credit facilities available to it and is fully compliant with its obligations under those facilities.

"In addition, MyTravel is fully bonded under CAA and ABTA regulations."

MyTravel's share price plunged 62 per cent on Thursday and a further 37 per cent on Friday.

The group's market value is now just £89 million, compared with a high of £1.4 billion in early January.