Agreement has been reached to transfer the ownership of Kerzner International's Atlantis Resort and One&Only Ocean Club, both on Paradise Island in Nassau, to Toronto-based Brookfield Asset Management as part of a $175 milion debt-for-equity swap.
Kerzner will continue to manage both resorts. Key parts of the new agreement include retention of the 8,000 resort employees, investment of approximately $50 million a year into property improvements and continuation of heavy marketing and promotion in key markets, especially in North and South America.
The transaction had been halted by a Delaware court in mid-January when a group of creditors more senior to Brookfield were concerned about being at a disadvantage to Brookfield in the event of a bankruptcy.
In addition, Kerzner will sell 50% of its ownership interest in Atlantis the Palm in Dubai to co-owner Istithmar World PJSC for $250 million and will continue to manage the property as part of a multi-year management agreement.
The completion of these deals allows Kerzner to focus on managing resorts while continuing to own the Atlantis and One&Only brand names and retaining the right to develop resorts under these names.
"With substantially less debt and a more flexible operating schedule, Kernzer is well positioned for sustainable long-term growth as a global management company," said Sol Kerzner, chairman. Follow Gay Nagle Myers on Twitter @gnmtravelweekly.