Monday, Feb 24, 2020
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‘A lot of progress in Baha Mar talks’

Baha Mar receivers are expected to make an announcement “very shortly” on a new buyer and when construction will resume on the project that came to a halt when its developer Sarkis Izmirlian filed for Chapter 11 bankruptcy protection in the U.S. one year ago, according to joint provisional liquidator for Baha Mar Edmund Rahming of KRyS Global.

“The joint receiver managers are currently in renegotiations with the bank [and] the contractor, China Construction America (CCA), and China State Construction Engineering Corporation (CSCEC) is also in negotiations with the bank as it relates to a completion contract at this time,” Rahming told reporters outside the Supreme Court.

“… There has been a lot of progress and I think very shortly you will be hearing from the receiver managers as to the progress that has been made in the negotiations with the bank as well as the negotiations between CCA and the bank.”

Pressed on that foreshadowed announcement, Rahming said, “In terms of who the buyer is and in terms of the completion of the project from a construction standpoint, you will be hearing about that from the receiver managers.”

Rahming spoke to reporters after Justice Ian Winder ruled that Granite Ventures, one of Izmirlian’s companies, which applied for a committee to be appointed to take over a $192 million claim the developer filed against CSCEC in the United Kingdom last October, did not have “standing” to move for the application.

Through Granite, Izmirlian sought to provide $80 million in debtor-in-possession financing for Baha Mar to stave off its collapse last year.

It is one of many of Baha Mar’s unsecured creditors.

None of the creditors have been paid, according to Rahming.

In response to the ruling, the developer said in a statement it is “disgraceful” that unsecured creditors have been shoe-horned into the winding up/liquidation legal process here in The Bahamas in which their interests have been marginalized.”

Izmirlian filed for Chapter 11 protection in Delaware on June 29, 2015.

The government made a counter move in Bahamian courts.

All of the Chapter 11 cases have since been dismissed.

Baha Mar was put into provisional liquidation at the instigation of the government in September 2015.

Subsequently, the Export-Import Bank of China (CEXIM Bank), the project’s lender, moved to put the development into receivership in October.

Last month, Prime Minister Perry Christie announced in Parliament that a “framework agreement” was made between CEXIM Bank and CSCEC to remobilize and complete Baha Mar.

On Tuesday, Christie said the government spoke with the Chinese stakeholders over the weekend and the receiver managers are in “final negotiations” and he was waiting for them to make an announcement.

Asked what that agreement entails, Rahming said, “We weren’t involved in those negotiations.

“That was something between the government of The Bahamas and the bank and the construction company and the attorneys [who] were involved.

“So, it’s not something I can speak to.”

Christie has insisted that he did all that he could to facilitate the involvement of Izmirlian and the project being completed.

To this end, Christie tabled summaries of legal advice from the government’s U.S. and UK attorneys regarding the Chapter 11 proceedings.

Both were dated June 20, 2016.

The law firms concluded that it was “unrealistic” that the bankruptcy proceedings would put Baha Mar on firm financial footing and result in construction being completed.

But the developer called this astounding and said more than a year later, the government has sought to justify its “sabotaging” of the Chapter 11 proceedings with legal arguments that were flawed on many accounts.

 

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