London, Dubai, 18 August 2006 - Dubai International Capital LLC ("DIC"), the international investment arm of Dubai Holding, today announced that it has agreed to acquire UK-based Travelodge Hotels Ltd ("Travelodge"), Britain's fastest growing hotel company, for 675 million from the Permira Funds. The acquisition is expected to complete in late September.  Travelodge's senior management team will remain in place under DIC. 

"We are delighted to have successfully acquired Travelodge," said Sameer Al Ansari, Chief Executive Officer of Dubai International Capital. "It is a strong brand with good growth potential, and an excellent fit for DIC. The budget hotel sector is growing and, in our view, has immense potential in the UK market.  Travelodge's outstanding management team has an aggressive expansion plan which we are confident will give us an excellent return on this investment."

Travelodge, the UK's second largest budget hotel company, operates 291 hotels, with 279 in the UK, nine in Ireland and three in Spain.  The company's aggressive UK growth strategy is on track to deliver a total of 32,000 UK rooms in the next five years.  Travelodge aims to be the biggest budget operator in London by the 2012 Olympics, with over 7,000 rooms in the British capital.

The acquisition of Travelodge is in line with DIC's strategy to diversify the assets of its parent company, Dubai Holding. Investments are made on the basis of the size, strength and growth potential of the business, the expected returns, and the quality of the management team and its ability to achieve its objectives.   

Commenting on the deal, Grant Hearn, Travelodge Chief Executive, said:  "We are pleased that DIC has shown such confidence in our business and our people.  Our new owners share our ambitions for Travelodge to lead the budget hotels sector here in the UK and grow the business internationally."

DIC's financial adviser on the transaction was Citigroup Global Markets Limited.

DIC's acquisition of Travelodge is the latest in a series of value-driven investments by the company, including a US$1 billion investment in DaimlerChrysler, the 800 million acquisition of The Tussauds Group, 700 million acquisition of Doncasters, and anchor investments of US$272 million in JD Capital investment company in Jordan and US$150 million in Ishraq, a company formed to develop and own up to 22 Express by Holiday Inn hotels in the Middle East.

-Ends-

Editor's Note
About Dubai International Capital (DIC)
Established in 2004, Dubai International Capital is an international investment company that primarily focuses on private equity.

It is a wholly owned subsidiary of Dubai Holding, a large and diversified group that operates in the fields of healthcare, technology, finance, real estate, research, education, tourism, energy, and communications.

Dubai International Capital manages an international portfolio of diverse assets that provide Dubai Holding and its stakeholders with

  • Value growth

  • Diversification

  • Strategic investments and relationships

DIC focuses on three primary asset classes:

  • Direct private equity investments

  • Private equity funds and co-investments

  • Listed equity and strategic investments

Since its inception in 2004, DIC has made the following investments:

  • Committed over US$300 million to private equity funds

  • US$1 billion investment in DaimlerChrysler, making it the company's third largest shareholder

     800 million acquisition of The Tussauds Group in the UK, the largest operator of visitor attractions in Europe

  • 700 million acquisition of Doncasters Group Limited in the UK, a leading manufacturer of precision engineered components and systems for application in a variety of industries

  • Anchor investor in Ishraq, a US$150 million company formed to develop and own up to 22 Express by Holiday Inn hotels in the Middle East.

  • Launched the US$500 million MENA Infrastructure Fund with HSBC to invest in infrastructure opportunities across the Middle East and North Africa.

  • JD200 million (US$272m) investment company 'JD Capital' targeting opportunities in Jordan

www.dubaiic.com

About Travelodge
Travelodge was the first budget hotel brand to launch in UK and is now the second largest budget operator in the UK (by number of rooms). Travelodge operates 291 hotels, with 279 in the UK, nine in Ireland and three in Spain. The company's aggressive UK growth strategy is on track to deliver a total of 32,000 UK rooms in the next five years.  Travelodge aims to be the biggest budget operator in London by the 2012 Olympics, with over 7,000 rooms in the Capital.

In 1985, Forte-owned Travelodge opened its first hotel on the A38, North of Lichfield, before developing another six roadside hotels in its first year.  Travelodge was acquired by Permira in February 2003 along with Little Chef. Travelodge employs 4,900 staff. Travelodge has 40 hotel openings planned in the UK this year, including Peterborough Central, Birmingham Maypole and Hatfield Central.

www.travelodge.co.uk

For more information, contact:
Dubai International Capital                                      
Joanna Macdonald,
Dubai             
+97150 559 7137 
              
Tom Wyatt,
ReputationInc,
London +442077582800
Mobile +447776240145      

Travelodge
Greg Dawson                              
+44 01844 365644

Rollo Head/James Leviton             
+44 20 72513801

Citigroup Global Markets Limited (Advisors for DIC)
Anthony Gutman                         
+44 20 7986 7012

Kashif Aslam                              
+44 20 7986 8339    

© Press Release 2006