The new owners say the UK budget hotel is underdeveloped

Travelodge, which operates 291 hotels in the UK, Ireland and Spain is being sold by its private equity owner Permira to Dubai International Capital.

The Dubai firm said it would invest in Travelodge with the aim of making it the UK's leading budget hotel operator by the 2012 Olympics.

The first Travelodge was opened in the Midlands in 1985.

Various owners

The brand was launched by hotel group Forte to cater for drivers needing a bed for the night and now employs 4,700 staff.

It has changed ownership several times over the past 20 years, being owned by Granada, Compass and latterly Permira, which acquired it for �712m in 2003.

Travelodge's new owner said it was "delighted" with the deal.

We are delighted that they have shown such belief in the potential of our business Grant Hearn, Travelodge chief executive

"It is a strong brand with growing potential," said Sameer Al Ansari, Dubai International Capital's chief executive.

"The budget hotel sector is growing and, in our view, is underdeveloped in the UK market."

Travelodge boss Grant Hearn said the deal would allow the firm to "accelerate our low price revolution".