Cendant Might Sell Travel Services Unit

Cendant Corp. said Monday that it was considering selling its travel services division, including the Orbitz and CheapTickets websites, to help pay down debt.

The unit could fetch as much as $4.5 billion, sources familiar with the situation said. A sale would be an alternative to a planned spinoff, part of a break-up announced by Cendant last year aimed at boosting the company’s stock performance and reversing more than a decade of acquisitions.

“Selling the unit outright could bring a higher price today, particularly if they were to consider selling it in pieces,” said Paul Keung, an analyst at CIBC World Markets.

Cendant said it still planned to spin off to shareholders Realogy Corp., its real estate unit, and Wyndham Worldwide, its hotels unit. Its Avis car rental business would become a pure-play company.

Cendant said it had received a number of unsolicited indications of interest for the travel division. The sources said the offers were as high as $4.5 billion.

Cendant said it had decided to pursue a sale -- in addition to a spinoff, which had been set for October -- because it does not expect a sale to result in negative tax costs.

The move comes one week after Cendant announced plans to rename its travel services division Travelport. The division also includes Galileo, an electronic network for travel agents, and Gullivers Travel Associates.

In the travel services business, Cendant competes with Expedia Inc., an online company that was spun off a year ago by IAC/InterActive Corp.; Priceline.com Inc. ; and Spanish travel booking company Amadeus, which a group of private equity firms and airlines took over last year.

The travel services division has been weighing on Cendant and caused a larger-than-expected charge against the company’s fiscal fourth-quarter earnings, which were announced in mid-February.

Cendant shares hit a 52-week low of $15.16 on Feb. 21, one week after the earnings report. On Monday, the shares were up 64 cents to $17.49.