The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Baha Mar director yesterday refuted the Attorney General’s suggestion that Bahamian contractors will only receive 10 per cent of the sums owed to them, revealing: “Sarkis Izmirlian personally told me he will make them whole.”

Dionisio D’Aguilar told Tribune Business he had “no reason to doubt” Mr Izmirlian, especially since Baha Mar’s Chapter 11 reorganisation plan - filed with the Delaware Bankruptcy Court - promises to pay Bahamian creditors 100 per cent of what they are owed.

He was responding after Allyson Maynard-Gibson, the attorney general, suggested outside the Cabinet Office on Tuesday that Baha Mar’s restructuring plan proposed to pay Bahamian contractors just $0.10 of every $1 owed to them.

And she suggested this 10 per cent payment would be spread over five years, as she called on the local construction industry - and Bahamians generally - to support the Government’s ongoing litigation to wind-up Baha Mar as the fastest way to ensure contractor remobilisation and the project’s completion.

Mrs Maynard-Gibson did not disclose where she received such information, for it is not contained in Baha Mar’s restructuring proposal. That document, and related press releases from the developer, were adamant that all Bahamian creditors - the Government, contractors and others in the private sector - would be paid 100 per cent of what the project owe them.

“I respectfully disagree with the opinion of the Attorney General,” Mr D’Aguilar told Tribune Business, when asked about the discrepancy between the Baha Mar and Government positions.

“Sarkis Izmirlian told me from his mouth that the Bahamian contractors would be paid in full. Sarkis Izmirlian is a man of impeccable integrity, and he has always conducted himself in the best interests of bringing the Baha Mar project to a successful conclusion.

“I know him personally, and if he tells me Bahamians are going to receive 100 per cent of what they are owed - as already stated in the restructuring plan - I have no reason to doubt him,” he added.

“If it’s already stated that Baha Mar is going to pay Bahamian contractors 100 per cent, I don’t know why the Bahamian government will not support this deal [restructuring plan].”

Baha Mar contacts, speaking privately to Tribune Business, effected bewilderment over the Attorney General’s comments and told this newspaper they did not know where she had obtained the ‘10 per cent contractor compensation over five years’ allegation.

As previously reported by Tribune Business, the Baha Mar Chapter 11 reorganisation plan appears to unequivocally pledge to make the Government and all Bahamian creditors ‘whole’ if it receives court approval and is implemented.

That is far from certain at this point, but the plan states: “Most notably, the plan does not impair the legal or equitable rights of Bahamian creditors or the Government of the Bahamas, whose claims will simply ‘ride through’ the Chapter 11 Cases.”

The restructuring plan also proposed ‘cutting through’ or looking past China Construction America (CCA), the project’s contractor, and allowing Baha Mar to pay-off what its sub-contractors are owed.

“The Debtors may negotiate directly with holders of CCA sub-contractor claims upon reconciling amounts due and owing from CCA to such holders in respect of CCA’s failure to remit payment, and at their sole discretion, make distributions on account of CCA sub-contractor claims,” the Baha Mar plan states.

Given these promises, Mr D’Aguilar questioned why the Government continue to “resist and frustrate” a plan that promised to fully compensate all Bahamian creditors.

He added that the Attorney General’s suggested compensation ‘does not add up’, given Mr Izmirlian’s previously expressed desire to remove CCA and complete Baha Mar using mostly Bahamian contractors.

Paying them 10 per cent of what was due, Mr D’Aguilar said, would not aid such an approach, and would also be ‘bad for business’ in a country that was Mr Izmirlian’s home and where Baha Mar planned to be a long-term player.

“I just don’t get it,” he told Tribune Business. “I respectfully disagree that it is in the interests of Baha Mar not to make Bahamian contractors whole. If you’re going to do business in this country, and these are the people you are going to do business with, it makes no sense to screw them.

“I am sure the Attorney General knows the Izmirlians are men of their word. She knows him well enough. If she called him and asked him: ‘Are you going to pay the contractors in full?’, he would tell her: ‘Yes’.”

That is likely a reference to the fact that the Izmirlian family were once long-standing clients of her law firm, Gibson & Company. Mrs Maynard-Gibson’s brother, Clement Maynard III, was the attorney who acted for Baha Mar in negotiating its initial Heads of Agreement with the first Christie administration.

Mr D’Aguilar, meanwhile, struck a more conciliatory posture in calling for all parties to the Baha Mar dispute to “extend olive branches” and reach a commercial negotiated settlement to complete and open the $3.5 billion project.

“Let’s start extending olive branches and stop fighting with swords and in the courts,” he told Tribune Business. “There’s a deal to be done.

“This mud slinging is not good for anybody. Everybody seems to be operating in their own bubble, and they need to start to talk to one another.

“The Prime Minister needs to become more active in bringing about resolution, and I believe the best solution to this problem is to include the developer. You can kick him out, but it would be a waste of time as it would delay the project a lot longer. It would take months, years to rebuild the management team.”

Mr D’Aguilar added that the Government “are reluctant for whatever reason to kick CCA out of the road”, suggesting that this stemmed from the contractor’s $200 million ‘The Pointe’ project and a desire to attract more Chinese investment to boost the economy and job creation.

He did, though, say Baha Mar was prepared to negotiate with CCA if it developed a serious proposal - complete with timelines, scheduling and a finish date - to conclude construction work on the project.

“I would trust Sarkis Izmirlian over CCA any day, any time,” Mr D’Aguilar told Tribune Business. “He’s a reputable man.

“You have to wonder why the Chinese think like they do. They don’t conduct business like us, they’re different from us, and they have a different philosophy and culture. I don’t know why the Government is the only one that can’t see it; they stand by them time and time again.

“When you constantly back one horse, you’ll never get a deal done. Do they honestly believe the Chinese have their best interests?” Mr D’Aguilar queried.

“Yet if CCA comes to the table and says: ‘This is how we intend to finish the project’, a meaningful discussion could be had with Baha Mar. If they have a plan as to how this is going to go and approach Baha Mar in a meaningful way as to how they intend to finish this project, Baha Mar will be mindful to include them.”