The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Sarkis Izmirlian says efforts to ‘buy back’ his $3.5 billion development have been foiled because Baha Mar’s receivers have failed to provide him with details and “timelines” on the Supreme Court-approved sales process they are running.

Mr Izmirlian and his BMD Holdings vehicle, in an April 15 letter to the Deloitte & Touche receivership team, said they feared being “disadvantaged” in comparison to other Baha Mar bidders because of the attitude shown towards their previous offers.

An ex-Baha Mar director, meanwhile, suggested that the receivers were “delusional” if they thought anyone could better Mr Izmirlian’s offer to make the China Export-Import Bank ‘whole’, and pay all the Bahamian creditors 100 per cent of what they were owed.

Dionisio D’Aguilar told Tribune Business yesterday that based on the interview given to Tribune Business by Raymond Winder, Deloitte & Touche (Bahamas) managing partner, it might take until “Christmas” to identify a preferred bidder.

He suggested that the formal sales process, set up by the receivers on behalf of the China Export-Import Bank, and approved by the Supreme Court, may not be in the Bahamas’ best interests given that it will further ‘drag out’ a resolution to the Baha Mar impasse.

“It’s unfortunate it’s going to take that long,” Mr D’Aguilar said of the sales process, to which all prospective Baha Mar buyers must submit.

“I understand these consultants need to make money, and I understand there’s a process, so rather annoyingly they have to go through that process.

“But if there is no one else out there giving the offer he’s [Sarkis] given, I’m sure the Government and everyone else will put pressure on the receivers to do something quickly.”

Mr D’Aguilar was responding after Mr Winder, one of the Baha Mar receivership team, told this newspaper on Friday that Mr Izmirlian’s efforts to negotiate with the China Export-Import Bank directly were in vain.

He explained that neither the receivers, nor the project’s secured lender, can negotiate deals with Mr Izmirlian outside the Supreme Court-approved sales process that was unveiled last month.

As a result, Mr Izmirlian’s April 11 letter to the China Export-Import Bank, reaffirming the Baha Mar purchase offer he made in January 2016, will be for nought, as the development’s financier cannot negotiate with him - even if it wanted to.

However, Mr D’Aguilar argued that the receivers are unlikely to obtain a better offer than Mr Izmirlian’s through their sales process.

Baha Mar’s original developer has promised to repay the $2.45 billon debt owed to the China Export-Import Bank, and make all Bahamian creditors, including the contractors owed a collective $74 million, plus local suppliers and vendors, whole.

“The way Ray Winder is talking, this is months, and months away,” Mr D’Aguilar told Tribune Business of a Baha Mar resolution. “We’ll be lucky if this is resolved by Christmas.

“Ray Winder, if he’s under the impression people will offer more than 100 cents on the dollar {Izmirlian’s bid], I think he’s delusional. I’m sure 80 per cent of the people think there’ll be no better offer. He’s offered 100 cents on the dollar, and no one else will offer 10 cents.

“The Commonwealth of the Bahamas and the people of this country need this project to get moving immediately; to be dealt with urgently. We can’t afford for this receivership to go on for ever and ever. We need to get this rolled out and moving quickly.”

Mr D’Aguilar said Mr Winder’s comments had “put a damper on things” just as renewed optimism had emerged of a rapprochement between the Christie administration and Baha Mar’s original developer.

Prime Minister Perry Christie and Mr Izmirlian met the Friday before last, the first encounter between the pair since autumn last year, following the end to Baha Mar’s Chapter 11 bankruptcy protection.

The meeting seemingly encouraged Mr Izmirlian to renew his January 2016 offer to the China Export-Import Bank, with Mr Christie calling for it to be given ‘due consideration’ by the Chinese.

Mr Izmirlian, though, has yet to provide ‘proof of financing’ for his bid, and Mr Winder put an end - for the moment- to this ‘straw clutching’ by emphasising that all bids had to come through the formal sales process.

In response, Mr Izmirlian and his BMD Holdings vehicles suggested that they were being inhibited from making such an offer by a lack of information from the receivers.

“We have previously inquired about the procedure to make a bid and associated timelines, only to be told that information is not currently available,” wrote Whitney Thier, a BMD Holdings executive and Baha Mar’s former vice-president and general counsel.

“Yet your comments in today’s paper make repeated references to what the sales process will not allow, i.e. our offer, without providing any concrete information.

“Of what benefit to the stakeholders is it to continue to conceal this information, and what possible harm could it do to reveal it given the importance of this project to the country and the number of Bahamians so directly affected by its outcome? Would you not think that potential bidders for this multi-billion dollar asset are entitled to understand the sales process?”

Questioning why Mr Winder had spoken to the media, instead of BMD Holdings, Ms Thier said Mr Izmirlian felt the sales process would place him at a disadvantage.

“Please be assured that we are not labouring under any impression that we will be given an advantage over any other investor who bids to buy the project, and rather feel that we may be disadvantaged over any other investor given that your response to our previous offers – made well before any official sale process was launched - was merely that they were unacceptable, with no explanation or further engagement,” Ms Thier said.

“Was the court (or the joint provisional liquidators) informed that there was a standing offer, from us or any other party, at the time that the receivers sought consent for the sale from the court?”

The sales process being run by Deloitte & Touche, on the China Export-Import Bank’s behalf, bars all bidders from speaking to Mr Izmirlian and his team, or the project’s Chinese contractor, without the receivers’ express permission.

Mr Izmirlian and BMD Holdings, though, reiterated their previous criticisms of that process, adding: “A sales process that is opaque, at best, is not designed to achieve the highest price from a broad spectrum of investors.

“Second, we are unclear what the receivers are actually doing to maximise value. For example, have the receivers taken active steps to further the UK litigation against CSCEC [the contractor’s parent] under the first completion guarantee to Baha Mar Ltd, or pursued the remedies against CSCEC under the second completion guarantee to China Export-Import Bank, or conducted further investigation into potential claims against any number of CSCEC subsidiaries for their misrepresentations to - and failure to inform - Baha Mar about their ability to complete the project?”