Travelodge, a US-based budget hotel chain, is to shed a number of its UK properties.
The hotel chain is to shed up to 10 percent of its 500 properties in the UK, and intends to reduce its rent bills on another 100 or so. The rationalisation comes in the wake of the group’s previous owners, Dubai International Capital, handing over control of Travelodge to US bankers, Goldman Sachs, and US hedge funds Golden Tree Asset Management and Avenue Capital, in a debt for equity swap.
Most of the 500 properties in question are not owned by the company, but rented, and it intends to find new owners for 49 of them, having also asked accountancy firm KPMG to negotiate rent reductions with 109 more.
The company saw an increase in profit of 20 percent, to £55m last year, but KPMG is still to ask creditors to write off £720m of Travelodge debt. Unless 75 percent of the company’s unsecured creditors agree to the deal it will go into liquidation.
The company’s problems are rooted in 2005, when Dubai International Capital acquired it in a £675m leveraged buyout from Permira, a private equity group, in a deal that loaded the company with £475m of debt. That debt has been costing the business £100m per year in interest ever since, limiting money for investment and refurbishment, despite the company achieving a 16 percent annual increase in revenue, culminating in a total of £370m last year. Dubai IC is set to lose £400m on the original deal.
The company still had plans for expansion, even up until January this year, when it announced that it would be opening 41 properties towards a long-term objective of operating 1,100 properties and 100,000 rooms.
Four major airlines in the UK have set aside their business rivalry and have jointly commissioned a survey into Air Passenger Duty and its impact on the country’s economy.
The four companies, British Airways, Virgin Atlantic, Ryanair and Easyjet first came together under the ‘Axe the Tax’ slogan last year, but have now stepped up their campaign by appointing Pricewaterhouse Coopers, a UK accountancy firm, to investigate the economic effects of the increased duty on the British economy.
The airline industry in the UK is unanimous in its condemnation of the tax, which increased by 8 percent at the beginning of the 2012 financial year in April, and is scheduled for a further increase in 2013. Via its ‘Fair Tax on Flying’ initiative, the industry is urging people to use its website to contact their MP’s and register their disapproval of the increases. The initial target is for 100,000 respondents to the petition, with over 90,000 having already taken a few seconds to complete the on-line e-mail template.
Responding to the numbers of new supporters that the fight against Air Passenger Duty has been gaining, including many trade associations and business groups, the chief executive of the British Air Transport Association, Simon Buck, commented: ‘It is great news to see more supporters joining the campaign. It is now clear that we are drawing support from businesses across all regions of the UK as well as the tourism industry. It is time for the chancellor to listen to what we are saying.’
Travel sized toiletries that are popular with tourists because of their space saving convenience can in fact be costing them many times the price of the same products in their standard sizes.
According to research that has been reported in the Daily Mail, airport shops are charging holidaymakers up to eight times the price for toiletries in miniature packs, when compared to what they would have paid for a regular sized bottle at a supermarket. Airport shops are cashing in on the popularity of miniature toiletries since the authorities introduced a 100ml limit on fluids and pastes in hand luggage when passengers are flying abroad.
Travelsupermarket.com undertook the study, and compared the prices of a number of branded toiletries sold in standard bottles in well known High Street retail outlets, with the smaller packages sold in Manchester and London airports. Among the disparities found was a 35ml can of Dove antiperspirant at an airport costing £1.99, while a 150ml can could be purchased from High Street outlets for just £1. Worse still, was a 50ml bottle of Johnsons Top to Toe Bath for babies that Boots charge £1.99 for at their airport outlets, while a bottle that is ten times the size, at 500ml, can be purchased from Asda stores for £2.67, making the airport version 845 percent more expensive per millilitre.
Travelsupermarket.com spokesperson, Bob Atkinson, told the Mail, ‘Whilst security regulations are tight in airports in this day and age, consumers can easily get caught out paying over the odds for their toiletries. We found over 30 products where the mark-up was over 100 per cent – or double the normal price per ml.’