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Travelodge landlords say still too much uncertainty, despite ‘sweetened' offer

17 June 2020 by
Travelodge landlords say still too much uncertainty, despite ‘sweetened' offer

The Travelodge Owners Action Group has said there is still too much uncertainty around the budget hotel chain's company voluntary arrangement (CVA) proposals, despite reported changes.

Viv Watts, speaking on behalf of the group, which represents the landlords of more than 400 of the group's 580 hotels, said landlords cannot support the proposals until further information is disclosed, and accused Travelodge of delay tactics.

Sky News reported that the hotel chain had "sweetened its offer to landlords", including proposals to increase their share of profits, make break clauses more accessible, and that shareholders would not be able to take money out of the company until landlords had been fully repaid.

Watts said: "Today's letters may be headline grabbing, but they contain only weak assurances and far too much uncertainty on crucial legal protections. Savers, investors and pension funds, charities and local authorities, cannot commit to voting in support of the CVA proposal until Travelodge discloses the key legal and technical clarifications that we have repeatedly asked for.

"This seems to be a deliberate strategy to delay the release of critical information, limiting our ability to take detailed advice and attempting to force through the CVA on Travelodge's terms. Travelodge has given us no choice but to advise stakeholders to withhold their vote until these clarifications are provided.

"The continued lack of transparency heightens uncertainty around the outcome of the vote. Stakeholders cannot be expected to support the proposal without the full information to hand."

The CVA will require the approval of 75% of creditors, with the vote expected on Friday. Travelodge declined to comment.

Travelodge landlords demand clarity on CVA proposals >>

Travelodge reveals details of CVA proposal seeking 38% total rent reduction >>

Photo: Shutterstock

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