Travelodge says no plans for Whitbread merger

by Tiffany Millar on August 10, 2010

Budget hotel chain Travelodge has said that it will not put its brand name up for sale. Despite rumours that its Dubai-based competition Whitbread had made an offer, CEO Guy Parsons said that it was simply media speculation.

The Daily Mail reported last Saturday that Whitbread, the international owner of Premier Inn, had approached it’s parent company DIC, the hotel chain has denied any action of the sort. Parsons said that DIC had reassured him that no such merger would be taking place in an interview given on Monday.

According to Mr Parsons any deal between the two groups would be unlikely as there were liability issues in the competition arena. He also said that he had spoken to DIC over the weekend and confirmed that there had been no negotiations with their CEO.

He added that it was the hoteliers’ view that it would not get past the competition authorities should the two firms strike a deal. He also added that any agreement would mean that one of the budget hotel groups would most likely end up with a monopoly in the sector.

DIC attempted to purchase the Liverpool football club back in 2007, but was unable to under the growing burden of $2.6 billion in financial debt. It has been reported that the budget hotel firm will most likely look to sell of any surplus assets to remedy its debts.

Currently, according to Parsons, Travelodge is looking to buy hotels run by local pub operators with the aim of acquiring 52 new hotels from restaurant and pub groups.  The hotels are next to M&B’s pubs, which the hotelier says would benefit both parties.

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