Travelodge will get financing from two New York-based hedge funds as the UK budget hotel chain owned by Dubai International Capital restructures debt.
Avenue Capital Group and GoldenTree Asset Management have underwritten a medium-term facility of £60m ($95m), James Leviton, a spokesman for Travelodge, said after the Sunday Times reported the company had six weeks to raise the money or it could face bankruptcy.
“All the lenders are working together to find a sensible solution to the debt structure,” Leviton said. “Travelodge is not going into administration.”
Avenue Capital and GoldenTree, which have held Travelodge’s debt since 2006, may ask the senior lenders Royal Bank of Scotland Group, Investec, Barclays and Babson Capital Management to participate in the fundraising, Leviton said.
“GoldenTree has been a very supportive lender to Travelodge for many years and continues to work closely with the company and management,” the hedge fund said in a statement on Sunday.
Travelodge runs 470 hotels in Britain, Ireland and Spain, according to its website.