Kerzner International is to hand over the ownership of its flagship Atlantis resort in the Bahamas to Brookfield Asset Management as part of a debt restructuring.
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Kerzner will also transfer ownership of the One&Only Ocean Club and the One&Only Palmilla, in Mexico, to the Canadian company. It will continue to manage the properties.
Brookfield is to exchange about $175 million of Kerzner's debt for the equity of the Bahamian and Mexican resorts.
The resort company owns the $1.5 billion Atlantis resort in Dubai in a joint venture with Dubai World. The Dubai property is not directly affected by this deal.
As of releases dated 2008, Dubai World also had a 30 per cent stake in Kerzner International.
Dubai World, through Nakheel Hotels, also announced that it was acquiring a 50 per cent stake in the Mexican resort, One&Only Palmilla in Los Cabos, three and a half years ago.
"For some time now, we have been actively engaged in constructive discussions with our various lender groups in order to improve our company's capital structure, optimize the value of our assets and position Kerzner for sustainable long-term growth as a global management company," said Sol Kerzner, the chairman and chief executive of Kerzner International. "[The] announcement is an important step towards that goal, allowing Kerzner to substantially reduce debt and streamline our balance sheet and operating structure."
rbundhun@thenational.ae
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