The developer of the $3.5bn Baha Mar mega resort and casino in the Bahamas has been granted a two-month reprieve after a Bahamian Supreme Court judge appointed provisional liquidators on Friday – as the government wanted – but limited the liquidators’ remit and adjourned further proceedings until 2 November.
Sarkis Izmirlian (pictured), chairman and chief executive of the developer, Baha Mar Ltd., celebrated Justice Ian Winder’s decision, given Friday 4 September, saying it "helps us move forward with our efforts to complete construction properly".
Today has been an important day for Baha Mar-one that gives all of us further confidence that we will succeed in our efforts– Sarkis Izmirlian, chief executive of Baha Mar Ltd.
In a ruling that took 90 minutes to read, Justice Winder said the power of provisional liquidators would be limited to preventing depletion of the assets of the largely Chinese-funded resort, which is 97% complete and was supposed to open in December 2014.
The ruling is likely to frustrate the government of Prime Minister Perry Christie, which filed the winding-up petition on 30 June in hopes of having the bankrupt developer’s assets liquidated.
In a bid to keep its creditors at bay, Baha Mar Ltd. sought protection under Chapter 11 of the US bankruptcy code in a court in the state of Delaware, USA, on 29 June.
The developer has also commenced a claim in the English High Court in London against China State Construction Engineering Corporation Limited (CSCEC), the state-owned parent of China Construction America Inc. (CCA), whose Bahamian subsidiary is main contractor on the beleaguered project.
Baha Mar Ltd. blames CCA for construction delays, while CCA accuses Baha Mar Ltd. of not paying for work done.
Sarkis Izmirlian, chairman and chief executive of the developer, Baha Mar Ltd. (Baha Mar Ltd.)
Financing the project through an estimated $2.5bn loan is the state-owned China Export Import Bank.
The bank, the contractor CCA and the Bahamian government have all sought to prevent Baha Mar Ltd. securing bankruptcy protection in the US.
"Today has been an important day for Baha Mar-one that gives all of us further confidence that we will succeed in our efforts," said Baha Mar Ltd.’s Sarkis Izmirlian, in a letter to staff on Friday.
"The Bahamian Supreme Court has made it quite clear that, in making this ruling, its present intention is to not have Baha Mar liquidated or our management replaced," Izmirlian continued, adding: "We are also pleased that the judge specifically stated that an objective is to make sure that Baha Mar’s assets are preserved-which is a priority we all share.
"We look forward to working with the provisional liquidator so they can conclude that we are taking all of the necessary steps to preserve the assets while, at the same time, developing the best, most efficient plan for moving forward."