Cox & Kings has confirmed it is weighing up the potential sale of its German business Meininger Hotels as it seeks to cut debt.

Meininger operates 28 budget hotels in 16 European cities, including one in London.

In a regulatory filing to the Mumbai stock exchange, India-based Cox & Kings said: “We have appointed merchant bankers for a possible sale of our Meininger business.”

The company added: “As stated in its earlier stock exchange filings, the company proposes to meet its financial obligations through a combination of internal accruals and monetisation of assets, and is in the process of evaluating the potential of every business to generate cash flows.”

Cox & Kings disclosed in July that its working capital has been stretched by difficulties replacing short-term loans with longer-term borrowings.

The company is taking “all required measures” to resolve the cash flow mismatch and is “evaluating each business” to improve operational performance, it said in an exchange filing at the time.

Iata suspended the Indian arm of Cox & Kings from its Billing and Settlement Plan (BSP) after the operator defaulted on two debt payments.