Budget hotel operator Travelodge is set to walk away from 49 of its hotels and write off £700m (€870m) of its debts under a controversial rescue deal.
Travelodge, which owns more than 500 hotels across the UK, Ireland and Spain and employs more than 6,000 staff, said the deals will secure its long-term future and free it of much of its crippling debt burden.
It wants the landlords of 49 hotels to cut rents by 45% over the next six months while it seeks new operators and is asking for a 25% rent cut for a further 109 sites it wants to keep.
Travelodge said there were no current plans to close hotels or make job losses.
As part of a wider financial restructuring, it has agreed that £235m of bank debt will be written off and £71m will be repaid, bringing its debt down to £329m, while a further £476m of loan notes will also be scrapped.
The rescue plan effectively sees Travelodge seized by its three main lenders — Goldman Sachs and two American hedge funds Avenue Capital and GoldenTree Asset Management.
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