Budget hotelier Travelodge has secured a £60 million line of funding and is trading well, a spokesman for the Dubai International Capital-owned business said.
He said the £60m pounds medium term loan facility, which replaces an existing line, has been underwritten by junior lenders including US firms Golden Tree Asset Management and Avenue Capital.
Travelodge was currently assessing if senior lenders, such as Investec, Barclays and Royal Bank of Scotland, also want to participate. Debt restructuring talks began earlier this year.
The spokesman was responding to a report in The Sunday Times which said Travelodge could face administration if additional funds were not raised.
The report said Golden Tree Asset Management and Avenue Capital were planning to seize control of the hotelier from DIC through a debt for equity swap.
"GoldenTree has been a very supportive lender to Travelodge for many years and continues to work closely with the company and management," said a GoldenTree spokesman.
DIC, a private equity group backed by state-owned conglomerate Dubai Holding, bought Travelodge from Permira in 2006 for £675m, backed by loans of £478m .
The spokesman said Travelodge, which has over 470 hotels across Britain, Ireland and Spain, employing more than 6,000, saw 2011 profit rise 20 per cent to about £55m on revenue up about 16 pe rcent to £370m.
(Reporting by James Davey; Editing by David Cowell)
