Travelodge strikes rescue deal with landlords and sheds 49 hotels

by liamssoft | August 17, 2012 at 10:54 am

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The UK's fastest growing hotel group Travelodge is asking landlords for rent reductions as part of a rescue deal that will see it jettison nearly 50 hotels, potentially putting 350 jobs at risk.

The budget hotel operator buckled under the financial strain of making repayments on borrowings of £1.1bn which date back to its debt-fuelled takeover by the Dubai International Capital (DIC), the private equity arm of the oil-rich Gulf state, in 2006.

Travelodge's financial problems mean it has effectively been seized by its three main lenders - Goldman Sachs and two American hedge funds Avenue Capital and GoldenTree Asset Management - with the DIC's ownership wiped out.

Source; guardian.co.uk