Hopes that a currently-shuttered Caribbean resort could be revived, to the benefit of its long-suffering shareholders, suffered a setback on Friday, after a court in in St Vincent and the Grenadines refused to grant the property’s developer more time to carry out its plan — thus forcing it into all-but-certain bankruptcy.
However, the company said it intends to appeal the decision.
The bankruptcy of Harlequin Property (SVG) Ltd, and subsequent liquidation of its assets, is seen as the likely outcome of Friday’s ruling, as Harlequin’s management needed the time to file its application for turning the beleaguered development around.
In a statement, Harlequin said it had actually filed its proposal for creditors with KPMG on Friday, before the court reached its decision, but that, “sadly, the court’s decision took away the opportunity for HP SVG investors/creditors to vote on the proposal”, which it noted is likely to lead to the business’s liquidation”. This, it added, “was exactly what 95% of [a cross-section of Harlequin investors] who recently voted in a survey wanted to avoid”.
The company noted that it had been advised by its legal team in the Caribbean that it has a good chance of succeeding in its planned efforts to appeal the decision.
“Harlequin believes a grave injustice has been done, and many HP SVG investors will be alarmed by what has taken place,” the Harlequin statement concluded.
Plan would revive Buccament Bay
As reported, Harlequin founder and chairman David Ames had put together what he said was a genuinely viable proposal for reviving Harlequin’s Buccament Bay Resort project in St Vincent.
He unveiled the plan to International Investment last month, a day after the UK’s Court of Appeal turned down a request by the UK accountancy, Wilkins Kennedy, to appeal a High Court judgment last December, which ordered it to pay US$11.5m (£9.14m) to Harlequin, in connection with an over-payment to a construction company known as ICE Group.
Ames said it was his intention to use the US$11.5m – minus legal fees and other costs incurred in bringing the legal case against Wilkins Kennedy – towards restoring the Buccament Bay development to “full use for the benefit of Harlequin Property (SVG) investors”, who, he explained, would be handed ownership of it as part of the deal. Four as-yet-unnamed hotel management companies were said to be vying to manage the resort on behalf of the Harlequin investors.
Harlequin investors account for the vast majority of creditors in the development, according to Ames.