The $3.5 billion Baha Mar Resort in the Bahamas was so close to opening in March that people were booking rooms. However disputes between the developer, contractor, and financier resulted in a construction slowdown eventually leading to a plea for bankruptcy protection, and finally foreclosure on the property by China’s State-owned export import bank (Exim).
Now it looks likes South African, Solomon (Sol) Kerzner, and Island Capital founder, Andrew L. Farkas may get a shot at sorting out the mess and Baha Mar CEO Sarkis Izmirlian may be left to twist in the wind as nearly a billion dollars in personal equity evaporates before his eyes.
On Friday Prime Minister Perry Christie told reporters on the sidelines of a data protection summit that he had instructed Exim to make a public announcement stating that they were in talks with several interested parties, including Kerzner’s group. However early in the week Tribune242 reported that the bones of a deal have already been agreed upon between receivers for the bank who foreclosed on the property last week, representatives of CCA, and a private merchant bank headed up by Farkas. The offer was reportedly made in partnership with Sol Kerzner who has vast experience in resort and hotel management through his One&Only Resorts and other successful properties.
The outlet reported that top negotiators for Farkas’ Island Capital had been in Beijing hammering out details to flesh out the offer which is yet to receive final approval. If all parties agree, the resort could open in six to nine months – a full year behind schedule.
Speaking on condition of anonymity, a lower ranking member of the Christie administration said that Izmirlian’s fate was sealed the moment a US bankruptcy judge declared he had no jurisdiction in the matter, returning control of the troubled property to Bahamian courts. Baha Mar maintains they are the sole owners of the property and refuse to comment, citing a history of “significant rumours, speculation and misinformation about Baha Mar.”
Baha Mar Ltd. – Mr. Sarkis D. Izmirlian Chairman and CEO – Investment $850 million
China Construction America, Inc. (CCA) – a wholly owned subsidiary of China State Construction Engineering Corporation Limited, which is in turn owned by the Chinese government.
The Export-Import Bank of China (China Exim Bank) – a state owned enterprise of the Chinese government – Investment $2.4 billion
Note: After 1949, all business entities in the People’s Republic of China were created and owned by the government. In the late 1980s, the government began to reform the state-owned enterprise, and during the 1990s and 2000s, many mid-sized and small sized state-owned enterprises were privatized and went public. CCA’s parent company was successfully listed on the Shanghai Stock Exchange on July 29, 2009.
Perry Gladstone Christie – Prime Minister of the Bahamas since May 2012 (previously he was Prime Minister from 2002 to 2007)
The Supreme Court of the Bahamas – The third highest court in the adjudicative hierarchy of the Commonwealth of the Bahamas
U.S. Bankruptcy Court – Wilmington, Delaware
Joint Provisional Liquidators – KRyS Global, Bahamas; AlixPartners Services, UK
Sol Kerzner – Founder, Chairman and CEO of Kerzner International – Major developments: Mohegan Sun casino in Uncasville, Connecticut; Sun City, South Africa; Atlantis Resort, Bahamas; The Palm, Dubai; One&Only Resorts.
Mr. Andrew L. Farkas – Chairman, Chief Executive Officer and Managing Member of Island Capital Group, LLC – Highly successful global real estate tycoon