Travelodge Hotels Limited is a private company operating in the hotels and hospitality industry throughout the United Kingdom. Branded simply as Travelodge, it is the second largest in the budget hotel sector (behind Premier Inn) and third biggest hotel chain in the UK by number of bedrooms (32,600 at the end of 2010).
Travelodge Hotels Ltd is under separate ownership from the Travelodge chain of the United States.
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Company history
Forte
In the 1980s, Lord Forte bought the US Travelodge brand and established it in Britain. He attached them to many of his Little Chefs as Little Lodge before later rebranding them as Travelodges.
Travelodge was formerly a division of Forte Hotels, and was known as Forte Travelodge. Since then, it has become a company in its own right and has over four hundred Travelodge hotels, mainly located beside motorways and major roads, although more and more hotels are being opened in city centres. The first hotel was opened in 1985 at Barton-under-Needwood on the A38 near Lichfield, Staffordshire.
Granada
In 1995, it was bought by Granada, when the Forte Group (formerly Trusthouse Forte) underwent a very unharmonious hostile takeover. In 2001, when Granada de-merged (creating Moto), it became owned by Compass Group. In 2003, it was acquired by Permira under the name of TLLC Group Holdings Ltd (113 Little Chefs, owned by TLLC, were nextdoor to Travelodges), moving its headquarters from Toddington in Bedfordshire to Thame in Oxfordshire in June 2003.
In 2004, it bought the Drury Lane Moat House hotel for £11m, and the London Farringdon and London Islington Thistle hotels. In July of that year, it decided to sell 136 of its hotels for £400m, then lease them back.
Dubai International Capital
In August 2006, it was sold to Dubai International Capital (DIC), a United Arab Emirates-based company, for £675 million.
In mid-2010, Travelodge bought 52 Innkeeper's Lodge properties from the Mitchells & Butlers pub chain, leaving less than half the original number of Innkeeper's Lodge hotels. In 2011, Travelodge announced a tie-up with British supermarket Waitrose to develop three joint sites in the UK.
Travelodge UK also operate eleven hotels in the Republic of Ireland and five hotels in Spain, with expansion plans announced in 2011 for fifty more hotels in Spain with its development partner Citygrove.
Financial restructuring in 2012
In February 2012, DIC had to prepare a bailout package due to a large debt of £478 million that was added to Travelodge's balance sheet following its purchase; despite significant earnings since 2006, these could not cover the debt repayments and the company recorded a debt of £517m in 2011. The company undertook a financial restructure during April 2012, with ownership passing to New York-based hedge funds GoldenTree Asset Management and Avenue Capital Group, as well as Goldman Sachs. On 17 August 2012 Travelodge UK confirmed that the financial restructuring would be through a company voluntary arrangement which would include:
- At least £75m of new money being injected into the Company.
- £55m being invested into a major refurbishment programme across the estate, covering over 11,000 rooms and 175 hotels. The refurbishment programme was due to start in early 2013 and continue through to summer 2014.
- Bank debt of £235m will be written off and £71m repaid, reducing total bank debt from £635m to £329m.
However, Travelodge also stated that it was no longer viable to operate 49 hotels (8% of the estate), for which the company would now seek new operators.
Hotels transferred to other hotel operators include Edinburgh Belford transferred to Britannia Hotels, Blackpool transferred to Ibis, Huddersfield, Liphook and Walsall transferred to Metro Inns, and Bolton Services, Eastbourne, Edinburgh Haymarket, Manchester Airport, Manchester Worsley and Wentbridge transferred to independent operators. Travelodge's hotels in Coventry and Sutton Scotney (North and South) were closed.
Following the closures and transfers, Travelodge built ten new hotels in Scotland in a £75 million investment ahead of the 2014 Commonwealth Games.
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Criticism
Overbooking
In 2006, the BBC Watchdog programme highlighted Travelodge's policy of overbooking their hotels, turning guests away even when they have booked against a credit card. When a whistleblower revealed that overbooking comes before anything else, Travelodge admitted to this practice and updated their website to confirm this. Guests who are found in this position are where possible found accommodation in a nearby Travelodge at no extra cost to them, but if no rooms are available nearby the reservation is cancelled and the customer is refunded to the payee's card. Travelodge say that overbooking is so more guests can make use of rooms that would otherwise be empty; however, the whistleblower programme contained footage of an internal Travelodge training video which stated that their business model required them to run all their hotels at maximum capacity, and that a 'last man standing' policy would ensure this always occurred.
Plymouth advertising
To advertise its new location in Plymouth in 2004, Travelodge ran a poster campaign using the phrase "Other hotels in Plymouth fleece you, we prefer duvets" which was not well received by other hotels in the area and was reported to the Advertising Standards Authority.
David and Jean Davidson's stay
In 2007, media around the world reported that David and Jean Davidson, a retired couple originally from Sheffield, had stayed at Travelodges in Newark, Worksop and Grantham for a combined total of 22 years, making each lodge their home. The retired banker and naval sailor and his wheelchair-using wife found the cost of their stay comparable with living in a house, but with the benefits of housekeeping service and without added costs such as council tax and utilities. Following their departure, at least one lodge named their room "The Davidson Suite".
Source of the article : Wikipedia
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