Prime Minister the Rt. Hon. Perry Christie addresses the nation on Baha Mar, July 16, 2015. (BIS Photo/Peter Ramsay)
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After two days of intense negotiations in
Beijing could not produce an out- of-court agreement on the way forward for
Baha Mar, Bahamas Attorney General the Hon. Allyson Maynard Gibson filed a
compulsory or involuntary winding up petition against the 14 Bahamian
incorporated companies that make up Baha Mar in The Bahamas Supreme Court on
July 16, 2015. This effectively paves the way for a court-appointed provisional
liquidator to supervise the completion and opening of Baha Mar in the shortest
possible time.
Prime Minister Christie in a nationally
televised address
on Thursday night said:“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. Izmirlian.”
The Prime Minister went on to explain the government’s
arrival at this decision in light of a court adjournment on July 7 for parties
to pursue a preferred out-of-court agreement on the way forward for Baha Mar.
“It 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. 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.”
The Prime Minister pointed out that the actions
taken by the Attorney General were not designed to punish or destroy Baha Mar,
but to 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. Such a solution will recognize
and respect the rights and legitimate interests of the key parties, including
Baha Mar and the Bahamian people.”
He said that the Government meanwhile has made
arrangements 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.”