Budget hotel company Travelodge has successfully completed its financial restructuring.
Under the terms of the financing agreement with its three key investors, GoldenTree Asset Management, Avenue Capital Group and Goldman Sachs £75 million of new money has been injected into the company.
In addition, £55 million will be invested into a major refurbishment programme across the estate, covering over 11,000 rooms and 175 hotels.
The refurbishment programme will commence in early 2013 and continue through to summer 2014.
Bank debt at Travelodge of £235 million has been written off and £71 million repaid, reducing total bank debt from £635 million to £329 million.
The repayment date for the remaining debt has been extended to 2017 and cash pay interest reduced significantly to a rate of 0.25 per cent above LIBOR through to the end of 2014.
Commenting on the announcement, Grant Hearn, chief executive of Travelodge, said: “Following the successful completion of the CVA process, the financial restructuring completed today will provide further stability to the business.
“It demonstrates our investors’ confidence in the Company and I believe we have now secured the long-term future of the business.”