Travelodge Ltd. will get financing from two New York-based hedge funds as the U.K. budget hotel chain owned by Dubai International Capital restructures debt.
Avenue Capital Group LLC and GoldenTree Asset Management LP have underwritten a medium-term facility of 60 million pounds ($95 million), James Leviton, a spokesman for Travelodge, said by phone 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 Plc, Investec Plc, Barclays Plc and Babson Capital Management LLC 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 an e-mailed statement today.
Travelodge runs 470 hotels in Britain, Ireland and Spain, according to its website.