Sol Melia has liquidity to meet debts 2008-2010

MADRID, Oct 15 (Reuters) - Spanish hotel chain Sol Melia (SOL.MC) said on Wednesday it had sufficient liquidity to meet its debt maturities up to and including the year 2010.

In a presentation to Spain's stock exchange regulator, the group said its current liquidity level was 635.1 million euros ($867.6 million), compared to debt maturities of 577.6 million for this year, 2009 and 2010.

It said it had cash and short-term deposits of 271.9 million euros, available credit facilities of 163.2 million and a syndicated loan of 200 million.

However, it reiterated that the economic downturn would hit its business. It said its negotiations with tour operators showed prices in Europe next year would only rise between 0 and 2 percent and prices for the Caribbean would rise 5 percent.

It faces cuts to the length of holidays by tour operators, said the presentation.

Sol Melia also expects limited increases in prices in urban hotels as corporate travel is cut back.

The inactive real estate market will also impact the group's asset rotation activity that accounted for 9 percent of the group's core profit in 2007.

Back in August, Sol Melia said it would not meet its 2008 sales, core earnings or net profit targets as a sharp economic downturn grips its home country Spain, and Britain.

Its first-half sales fell 2.7 percent to 618.5 million euros, while earnings before interest, tax, depreciation and amortisation (EBITDA) was down 16.2 percent at 124.3 million. (Reporting by Sarah Morris, editing by Dave Zimmerman)