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Travelodge considers walking away from 50 hotel sites as part of restructuring

14 August 2012 by

Budget hotel chain Travelodge is considering walking away from 50 of its sites to help tackle its £500m debt burden.

The company is understood to be looking at asking landlords to accept a company voluntary arrangement (CVA) as part of a wider restructuring, according to reports in the Times.

However no jobs are thought to be at risk because the hotels involved would be transferred to new operators over the next year.

Should the landlords of the hotels accept the deal, it is expected to form part of a wider financial restructuring which will see American hedge funds Avenue Capital and GoldenTree Asset Management joining US bank Goldman Sachs to take over ownership from Dubai International Capital.

Travelodge is thought to be trading well but is struggling to deal with its £500m of debts, accrued during a buyout spree before the financial crisis set in.

A Travelodge spokeswoman said: "We are restructuring our debts at the moment but nothing has been decided. In this type of process there are lots of conversations that take place and a lot of options around the table but at this stage we haven't confirmed anything."

By Neil Gerrard

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