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Kerzner May Sell Stake In Dubai Resort-Report
The Bahamas-based company is in talks to sell the stake to Istithmar World, Dubai's investment arm, people familiar with the matter told the Journal.
August 31, 2011 11:56 by Reuters
Luxury resort operator Kerzner International Holdings Ltd may sell its 50 percent stake in the Atlantis resort in Dubai to raise money to restructure $2.6 billion in mortgage debt coming due next week, the Wall Street Journal reported on Wednesday, citing sources.
The Bahamas-based company is in talks to sell the stake to Istithmar World, Dubai’s investment arm, people familiar with the matter told the Journal.
The sale, if consummated, could reap as much as $250-$350 million, the people said.
The proceeds would go toward paying down a portion of the mortgage debt on a separate Atlantis resort in the Bahamas, Kerzner’s flagship property and one of the most popular resorts in North America, the report said.
Kerzner International has been in talks with creditors to extend maturities on its debt due next month.
The company was taken private in 2006 by its chief executive and founder, Sol Kerzner, leading a consortium of investors including Dubai’s Istithmar PJSC, Colony Capital LLC and Providence Equity Partners.
If Kerzner doesn’t soon sell the Dubai Atlantis stake and get a wider restructuring deal done, creditors are likely to grant short grace periods to effectively push back by a few weeks the due date on the company’s mortgage, the Journal reported.
The sale discussions remain fluid and might fall apart, the people said.
(Reporting by Soham Chatterjee in Bangalore; Editing by Matt Driskill)