THE Government has filed a winding up petition in the Supreme Court against Baha Mar after talks involving the developers of the troubled $3.5 billion mega-resort in China this week failed to reach an agreement. (BAHA MAR RESPONDS HERE)
The move comes after Baha Mar filed for Chapter 11 bankruptcy in the United States more than two weeks ago and negotiations in Beijing involving the government, the resort developer, China State Construction and China Export Import Bank proved fruitless.
In a televised address to the nation tonight Prime Minister Perry Christie said the opening of Baha Mar was “a matter of the utmost national importance”.
“Whilst we certainly remain open to further discussions, my Government has taken the decision to seek to bring the Baha Mar development project under the control and supervision of the Bahamian Supreme Court, right here in The Bahamas,” Mr Christie said. “Consequently, on the advice of our Bahamian, UK and US lawyers, the Attorney General has today filed a winding up petition in the Bahamas Supreme Court against the 14 Bahamian entities that filed for Chapter 11 protection in the United States at the end of June.
“These compulsory or involuntary winding-up proceedings are designed to work in very similar terms as a Chapter 11 but with the stark difference that they will be controlled by provisional liquidators under the supervision of the Bahamian Courts rather than being controlled by Mr (Sarkis) Izmirlian (the developer). These liquidators, if appointed by the court, will be neutral and impartial professionals of the highest quality and of impeccable credentials.”
The Prime Minister said the role of the liquidators would be to expedite the resolution of the matter and to prepare a plan for the restructuring of Baha Mar that would result in the earliest possible completion and opening of the project. He said the action taken was not designed neither to punish Baha Mar nor destroy it. “On the contrary, the purpose of the provisional liquidation is to enable the appointment of a neutral party to take control of the process and to work with the key stakeholders under the supervision of the Bahamian Court to prepare a strategic and workable roadmap for the completion and opening of the resort,” he said. “Such a solution will recognise and respect the rights and legitimate interests of the key parties, including Baha Mar and the Bahamian people.”
Baha Mar were understood to be “shocked” and "surprised" at the move.
Of the Beijing meeting and the events that led to the filing of the winding up petition, Mr Christie said: “After working diligently around the clock to arrive at a solution acceptable to all parties, and having made considerable progress, the talks nonetheless ended without agreement whereupon the (government) delegation returned to Nassau this morning and promptly reported to Cabinet along with its legal advisors.”
Mr Christie said it had transpired at the Beijing negotiations that Baha Mar’s additional funding requirements had increased considerably, and now included not only funding for completion of construction, but funding to meet start up and operating expenses, funding to cover other liabilities and deferral of principal and the initial balloon payments under the loan facility with Eximbank.
“I am advised that both Eximbank and China Construction Company demonstrated flexibility in meeting Baha Mar’s expanded funding requirements, and project completion date,” the Prime Minister said. “This notwithstanding, Baha Mar still wanted an extended period for further negotiations which, however, was not acceptable. Baha Mar was also not prepared to agree to terms which would have included the immediate discontinuance of their Chapter 11 Bankruptcy proceedings in the United States and their legal action against China Construction in the United Kingdom. These terms were demanded by Eximbank and China Construction, and supported by the Government, as conditions to any agreement for additional funding, resumption of construction and project completion date.”
A Supreme Court hearing is scheduled for Monday.
Mr Christie said the government has arranged for a second payment of salaries of Baha Mar’s Bahamian employees, with a view to such payments being recovered in due course so as not to place any additional strain on the Bahamian taxpayer.
Read the Prime Minister's full speech here.
Comments
a2z 8 years, 10 months ago
Wow. So Izmirlian is essentially out the door. Welcome to 1980.
Of course, no one believes you Christie. This is intended to 'punish' the developer. But I gat news for you. I think the actions the developer has taken to date, knowing full well what the potential outcomes could be, are deliberate. He wants out. And he's taking his out before he says much more than he already has about the government of The Bahamas.
I don't hold Izmirlian in the highest regard, but this type of treatment will resonate with the foreign investor the world over, and Bahamians will suffer even more. You shouldn't use the foreigner, and you certainly shouldn't use your people, who have now become YOUR pawns in this mess.
John 8 years, 10 months ago
The question now is what takes precedence: the chapter 11 bankruptcy protection filed in Delaware or the winding up order filed in the Supreme Court here. This is a tricky situation and international law will most likely apply. Of course Izmirilin will request a change of venue citing conflict of interest as the Bahamian government is now party to the winding up petition despite having no equity stake in Bah Mar. This could be long.
John 8 years, 10 months ago
And even if Izmirilin is forced out in the liquidation procedures he will still be allowed to proceed in his lawsuits against China bank and The China construction Company citing sabotage and collusion . If the outcome favors Izmirilin and the assets (Bah Mar) has been disposed of, the damages can be significant. If, on the other hand, Izmirilin loses the lawsuits or fails to persue them, then Bah Mar can move on as a free corporate entity. If Izmirilin feels that construction at Bah Mar had been intentionally slowed down and/or otherwise sabotaged by one or both of the other parties involved, then asking him to sign an agreement to correct or complete these works (with the same two parties) is like asking him to compromise his legal position.
SP 8 years, 10 months ago
................................. Always Remember The Lyford Cay Mantra ................................
"Pirates are just misunderstood entrepreneurs"....... Michael Dingman
digimagination 8 years, 10 months ago
Mother, "Our son is an entrepreneur" - Father, "That means he doesn't have a rel job!"
SP 8 years, 10 months ago
.... Strong Dose Of Medicine To Cure Christies Xenophobia Against Bahamians .....
Mumbo Jumbo Christie stupidly declined more than ample opportunities with numerous Bahamian entrepreneurs FDI partnerships bringing $BILLIONS to the table that would have easily leveraged the countries anemic growth with or without Baha Mar.
Instead he choose to maintain the entrenched "Bahamians need not apply" xenophobic posture that has stifled growth in our country for 42 years leading us to near failed state status.
For the sake of the country, we all wish Baha Mar is fast tracked to operational status.
No sympathy for PM Christie.
Jackass Reaps As Jackass Sows.
Voltaire 8 years, 10 months ago
Exactly SP - What you said.
Hogfish 8 years, 10 months ago
you got to finally give it to Hubigitty. He saw the writing on the wall. He knew this was what the chinese wanted.
Also Harrahs saw this was going to happen.
The Chinese wanted it all from the start and only PLP could be corrupt enough to let it happen.
DEDDIE 8 years, 10 months ago
The Supreme Court couldn't successfully wind up Gulf Union Bank or Clico so please tell me how will they be successful with a 3.5 billion dollar company.
Sickened 8 years, 10 months ago
Pray tell... which well known, name brand, hotel will choose to be a part of this now or in the future? I foresee the only hotel names signing up in a few years, after all this dust has settled, will be names we, and our tourist market to the north, will not be able to pronounce. Thanks Christie for turning off the only light in our tunnel. YOU ARE USELESS!!!
TalRussell 8 years, 10 months ago
Comrade, Comrades yesterday put the final nail in ending Baha Mar's "Too Big to Fail" positions taken by Prime Ministers Christie and Papa Hubert and a large chorus of many others who should or may have known better, who just couldn't understand the simplest barometer for measuring a solvent versus a non solvent company, is the day they are no longer capable of meeting their most basic of financial and contractual obligations, like your damn payroll.
Financial problems and poor management have reared their warning heads many times before yesterday but the truth will now be told for all to hear, that it was long doomed for certain failure, even before the excavators turned the first bucket soil over on da "people's" priceless Cable Beaches parcel lands.
Time has now spoken that neither prime minister were courageous enough to step forward to admit that, what they did with the people's taxes and lands at Baha Mar on Cable Beach, was so damn misguided. Yet both former law partners had their noses stuck deep up in it, right up to its liquidation recognition day.
PM Christie, all that's really left for you do, is to appoint your former law partner as the "Official Liquidator From Cooper's Town" to wind things up on Cable Beach. Comrades that has been my take on Baha Mar, from day one and I sure as hell blogged it many times. I kept on saying I don't believe a damn word ff anything these people were telling taxpayers.
GrassRoot 8 years, 10 months ago
All this does, is ensure that Baha Mar will NOT open in the shortest possible time. And our VAT dollars will be used to create employment guarantee for laid off people. exactly what our spoiled work force needs to feed their sense of entitlement. So tell me PGC: who will serve food to all the Chinese arriving as tourists? Our Bahamian work force that cant even write in English? Baha Mar will become a Chinese colony on our shores. This place will be so cramped with Chinese immigrants that there is no more space for the Haitians. Maybe this Government sees this as progress.
newcitizen 8 years, 10 months ago
Oh, thank god the government is taking over. With such an outstanding track record (BEC, Bahamas Air, Hotels Corporation, BAMSI, paying down the national debt, balancing budgets, web shops, crime) we're sure to have this project done in no time. And I'm sure that it won't cost the taxpayers any money at all, since the government is great a running businesses and the amount required to finish the project it seems is only about 65% of our government budget. And this will for sure keep any sort of funny payments and corruption from happening. It's just so comforting knowing that we have so many people in the government with enough knowledge and expertise to take a $3.5B company through liquidation.
Really though, I think the one thing worse than the Chinese Bank taking control of the project is our own government doing so.
TalRussell 8 years, 10 months ago
Comrade neither the Chinese Bank nor its construction arm, ran the management at Baha Mar. You can't get away with acting all crazy like some other people, by skipping right over Izmirlian.
newcitizen 8 years, 10 months ago
No doubt Tal, the project was mismanaged by Izmirlian, but that will be nothing compared to how mismanaged it's about to get.
banker 8 years, 10 months ago
So, if the top company is the debtor in possession, then the liquidators have to give all the assets of the lower Bahamian companies to the Delaware company? As debtor in possession, it would have the first claim to all of the Bahamian companies.
What is wrong with this picture? Is the government legally brain dead? Can a lawyer please explain? A real lawyer?
asiseeit 8 years, 10 months ago
meanwhile Cuba is ramping up, http://gcaptain.com/spanish-ferry-com...">http://gcaptain.com/spanish-ferry-com... The Bahamas government is in bed with the Chinese and Uncle Sam will make sure that bed is hard very uncomfortable. You think Uncle Sam will just let the Chinese have The Bahamas without a fight? As I said The Bahamas of tomorrow will be the Cuba of yesterday. tighten your belts because we are in for some lean years ahead!
HarryWyckoff 8 years, 10 months ago
We are about to see a mass exodus of foreigners, both businesses and individuals, from The Bahamas.
This government has officially destroyed any chance of this country amounting to anything in the eyes of the world, but at least they will have what they wanted - the Bahamas for Bahamians (and Chinese, of course - lots and lots of Chinese)
No foreign entity will ever invest here again, after seeing the government bow so low to China's wishes. The US, who are in constant conflict with China, will disown the place.
You're all on your own now. I hope you all have a backup plan for when the Financial Services industry evaporates as foreign banks leave en mass, and tourism is restricted to visitors from socialist/communist countries.
You're gonna need it.
TalRussell 8 years, 10 months ago
Comrades, I want to hold onto some faint hope that not a single member PLP cabinet, except V. Alfred, could still be so naive to think that even the internationally tarnished name of Baha Mar, can/should be allowed survive this bankruptcy.
You can't just pickup from Izmirlian and continue on as it's just a matter of completing few small things and rescheduling an official opening date.
I would like see the PM invite J. Henry Bostwick QC, Honourable Lawyer Geoffrey Johnstone and former retired Justice Jeanne Thompson, or equally sober and proven to be credibility and independently thinking, honest and intelligent minds, to lend their time and energies to protecting taxpayers.
HarryWyckoff 8 years, 10 months ago
If the Government hadn't taken so much in bribes from the Chinese, and let the Chapter 11 stand, work would already be underway on finishing the job.
Izmiralian saw the Government's plan and made the smartest move available with the filing.
The PLP had already been paid to ensure the Chinese got the end product, sadly.
stislez 8 years, 10 months ago
Quick question, who gat the most money out, The izmaralians, the bahamas or china? If money run tings just about everywhere on this physical earth, who then is in charge? (Besides God is the real run tings with everything)....................................CHINA RIGHT! So all the arguing over someone else money is pointless. Yeh is our land, but the PM dem done do the honors of treating it like the stock market, so whats left is the money. Who have the most money have the most power obviously. This just my opinion, we are a culture of salves to the money. If you cud say our livelihood is based on TOURISM, then you basically saying we cant support ourselves without someone else money. I grow up when our number one resource was fishing, farming and sponging. Now someone else gat the fish, farms and sponges and we left with BAMSI, and the SPORT FISHING white people. While our fishermen on the side of the road tryna feed they family. I just saying..................................ine saying we should let this go under the rug or anything but i think we all focused the wrong place. My humble opinion is we should start with ourselves as individuals. We shouldnt be looking for no one to feed us and give us jobs as a country, why not feed ourselves, live off the land an become truly independent. Acquire knowledge that could help build a nation and sustain it, each one teach one. Lets stand on life principles an not social status and all for me mentality. Funny thing is i make a comment the other day on the post about the rubis thing going saying almost the same thing and one person was like, ya cant even get Bahamians to stop buying gas from rubis so ya een gone get them to do all dat! I was like its that thought right there alone that needs to be change...............
asiseeit 8 years, 10 months ago
You have no idea. I will always remember my Granny telling us how a can of Carnation was a special treat growing up. You are about to learn what that means!
Incognegro 8 years, 10 months ago
I know we are all upset, and we as Bahamians have every right to be. These are the men and women that some of us have elected to govern the country and for the best interest of we the people, and despite the bum job they appear to be doing, it is what we have right now. Let's all pray that they would do the job they have been elected to do, and hope this resort gets opened for the betterment of all Bahamians...but...who knows....it is really looking dim right now, and who knows what the Chinese REAL intentions are and what they REALLY have up their Chong Lee sleeves, that rabbit hole is the equivalent of the Long Island Blue Hole. We might as well buckle down and get use to this.
The question to ask is come 2017, who and which party are we prepared to vote the reigns of the country to? Two zero one seven will come like a thief in the night, and the governing party of 2017 will be the ones to either be stuck with this mess, or with the reward if it sis ever resolved!
asiseeit 8 years, 10 months ago
So when FDI dries up will tourism alone bring in enough dollars to support our import bill. We import everything and you can not pay for anything outside of The Bahamas with B dollars. So what happens when we do not have anything but B dollars. We can't import our food from China. See why FDI is so important? This country is in serious trouble!
Baha10 8 years, 10 months ago
Looking "dead good", ... so far!
SP 8 years, 10 months ago
LOL, He Got The "DEAD" Part Right, 1 out of 3 Is Above Average For Him!
Well_mudda_take_sic 8 years, 10 months ago
AS I SAID YESTERDAY: Christie, Maynard-Gibson aka Wicked Witch and Gomez aka Minion will now seek to rob the Izmirlian family of their entire interest in the Baha Mar property physically located in the Bahamas by any means possible, which, when all is said and done, will be tantamount to a de facto confiscation by expropriation of the Izmirlian family's equity interest in the property for the benefit of Christie's new found Chinese friends. You can be rest assured every Bahamian government department, agency and corporation will be instructed not to assist the Izmirlian family or Baha Mar's representatives in any way whatsoever without the express approval of Christie or his Wicked Witch on his behalf. As for any legal actions to be heard in the Bahamian courts....well, we all know the influence that can be wielded at will over our courts by the Wicked Witch doing Christie's bidding. Of course it will take many years for the value of the Izmirlian family's equity interest in the venture to be determined by the eventual outcome of the legal actions properly brought by Baha Mar, as a last resort, before foreign courts in Delaware and the U.K. The only honourable thing Christie could possibly do now is dissolve parliament, but he is too delusional, self-infatuated and irrational to do anything honourable!
Well_mudda_take_sic 8 years, 10 months ago
AS "REALITY_CHECK" SAID YESTERDAY: If delusional Christie, hissy tissy Maynard-Gibson and minion Gomez are fool enough to do as you say here, then the Bahamian people can be rest assured that no other significant foreign investors (other than the Chinese government) will ever invest in our economy. Foreign investors already here (except the Chinese) would also accelerate the selling-off of their hard property assets in order to make a clean exit from our shores as quickly as possible. Also, the Izmirlian family, through Baha Mar, would likely be justified in asserting very substantial legal claims (in foreign courts) against the Bahamian government for the added losses that would be incurred as a result of the vindictive conduct of Christie, Maynard-Gibson and Gomez. Any claims the foreign courts might award Baha Mar (the Irzmirlian family) against the Bahamian government would amount to mega-millions of dollars and would have to somehow be paid out of the hides of honest, hardworking and already over-taxed Bahamians.
sheeprunner12 8 years, 10 months ago
The Chinese will soon own Bahamar, Cable Beach and the Bahamian island of their choice ....... in return for opening the white elephant by the sea
This will be Perry's legacy ............... he sold the Bahamas to the Chinese for Bahamar
How can Perry put Bahamar into liquidation without a sure fire sale deal with the Chinese ...... this is the Ingraham BTC sale ............. on steroids
Lord Jesus ........................ is my island up for sale?????????????
asiseeit 8 years, 10 months ago
You really think Uncle Sam is going to let a Chinese run country, right on it's doorstep, prosper. Now we see why Cuba has been opened up. Boy, we got some serious problems now! We just went in reverse 30 years, the IMF and the rest coming for they things, and Foreign investors will not touch this country for decades. This PLP government has caused more harm to The Bahamas than any single entity in our history. Birdie them must be proud!
killemwitdakno 8 years, 10 months ago
Maybe the construction company doesn't want to go back to China.
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