Sarkis Izmirlian called for a moratorium on Baha Mar's sale to Chow Tai Fook Enterprises Ltd.
By AVA TURNQUEST
Tribune Chief Reporter
BAHA Mar CEO Sarkis Izmirlian said the Christie administration has chosen a “perilous path” with its petition to appoint liquidators to oversee the $3.5b property, stressing that his company’s Chapter 11 bankruptcy filing is the best option.
In a letter sent to Baha Mar employees on Friday, Mr Izmirlian stressed that the government’s proposed plan of liquidation would be costly and waste the resort’s assets. He stressed that he has been working for more than a decade to see Baha Mar come to fruition and will not quit.
He added that Baha Mar will “vigorously oppose” the legal attempt by one of its major hotel brands to terminate its contract with the stalled development.
Mr Izmirlian revealed that out-of-court negotiations with its Chinese counterparts have stalled as the major parties await a Supreme Court ruling on the government’s winding up petition, adding that it was this petition that drove Rosewood Hotels and Resorts International to seek to end the contract last week.
In his letter, Mr Izmirlian appealed for staff to “continue as usual” as the resort worked “tirelessly” to ensure a swift opening.
“Despite our efforts to reach a consensual resolution with the other private parties to date, discussions between us have now stalled due to the court hearings taking place over the last several days concerning the Bahamian government’s attempt to force upon Baha Mar a government-designated provisional liquidator to oversee Baha Mar’s assets,” the letter read.
“The dangers of what the government has unleashed on Baha Mar is reflected in the motion filed this past Thursday by Rosewood Hotels and Resorts in the US bankruptcy court seeking to terminate its contract with Baha Mar. In this filing, Rosewood clearly states that its decision is principally driven by what it perceives to be its vulnerabilities as a result of the Bahamian court’s actions. We will vigorously oppose this motion in the US court at the appropriate time,” Mr Izmirlian continued.
During a court hearing on Friday, Supreme Court Justice Ian Winder said he needed two weeks to come to a decision on whether to grant – or strike out – the government’s winding up petition for the appointment of provisional liquidators, which the government has said will speed up completion of the stalled Baha Mar development.
The adjournment of the matter to September 4 followed three full days of legal arguments from counsel for the government and the Cable Beach resort on the former’s attempt to wind up Baha Mar Ltd, Baha Mar Land Holdings Ltd, Baha Mar Properties Ltd, BMP3 (Wyndham Hotel) Ltd, BMP Golf Ltd, Cable Beach Resorts Ltd and Baha Mar Enterprises Ltd on the basis that is owed upwards of $59m by the various companies.
Amid this ongoing court action, Mr Izmirlian again stressed that the Chapter 11 path, which the government has opposed, is the best route for his development.
“As we have made clear,” the letter read, “we are highly confident that the Chapter 11 process now underway provides the most assured path for Baha Mar to be completed properly and opened successfully as soon as possible. In contrast, the liquidation of Baha Mar proposed by the government is a perilous path – one that could be highly costly, wasting the assets of Baha Mar to the significant disadvantage of its creditors, citizens and the longer term economic potential of the Bahamas. A liquidator is a liquidator, not a party that knows Baha Mar, knows how to manage the resort, or has an economic and personal stake in its successful opening.
“I want to reiterate that we, who are Baha Mar, are committed to doing all we can realistically do within the Chapter 11 process to resolve the issues that have impacted Baha Mar and prevented it from opening. We have been working for over a decade to create Baha Mar. We are almost there. We are not quitters.”
Baha Mar filed for bankruptcy protection in the US on June 29, however the Supreme Court has rejected the resort’s application for the matter to be recognised here.
Baha Mar is at odds with its general contractor, China Construction America (CCA) Bahamas, which it has blamed for numerous opening delays. However, CCA has placed the blame for the resort’s woes on Baha Mar executives, citing mismanagement as the reason the property is behind schedule.
Baha Mar was initially expected to open in December 2014.