Attempts to sell online travel agency Directline Holidays are understood to have been shelved due to poor market conditions.

Reports surfaced in August last year that founders Matthew Flint and Antony Bradley of the Croydon-based retailer had asked accountants KPMG to carry out a strategic review and find a buyer.

The Advantage Travel Centres member always refused to comment on the speculation, but the business was believed to be up for sale with a £40 million price tag.

The latest decision to ditch sale plans is thought to be the second in recent years with a previous attempt to sell the business put on hold in 2008 because of the recession.

The company would not comment on speculation that the latest attempt to sell the business, and a possible management buyout, had been put on the backburner in the current market.

However, it is understood the company felt the current economic climate meant it had failed to attract a bid that reflected its value. It is now focused on growing the existing business.

The firm was set up by Flint and Bradley in 1992 and has become one of the UK’s largest independent online travel agencies. Dirctline this week appointed new online marketing manager Katie Harrod, who had previously worked for digital marketing agency Commission Junction, to bolster its web presence.

The firm’s founders took a less active role in the business in 2009 when current chief executive Maria Whiteman was employed to run the company day-to-day.

The news follows the decision by late Escapes founder John McLean to postpone the launch of his online travel retailer MyWayTravel because of the poor economy.