Hedge Funds Put Up $95 Million for Travelodge Debt Restructuring
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Monday, February 20, 2012
Travelodge Hotels Ltd., the UK-based budget hotel brand owned by Dubai International Capital, will get financing from two New York hedge funds to forestall bankruptcy.
Avenue Capital Group and GoldenTree Asset Management have underwritten a medium-term facility of $95 million, according to a company statement. Travelodge also denied reports that it faces imminent bankruptcy. "All the lenders are working together to find a sensible solution to the debt structure," said James Leviton, a Travelodge spokesman. "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.
Dubai International purchased Travelodge in 2006 for around $1.3 billion.
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