Receiver Manager: Dialogue Can Resolve Issues with InterContinental Hotels Group
The receiver/manager for InterContinental Hotel in Lagos, Messrs Kunle Ogunba & Associates, yesterday formerly reacted to the threat by the InterContinental Hotels Group (IHG), the multinational hotels company which manages the Lagos-based five-star hotel, to pull out of Nigeria by January 18 over a breach of contract and huge debt owed it by the law firm appointed by Skye Bank Plc.
The law firm, in a statement yesterday, stressed that it would not be stampeded into paying IHG when the hotel’s finances cannot accommodate its demands, saying it would continue to seek for understanding and dialogue with the British-based hotel group as a way out of the situation.
The receiver/manager maintained that the allegations by IHG were totally false and ingeniously fabricated, saying it would not yield to blackmail.
“The receiver/manager has remitted over N173 million to the Intercontinental Group as of date. Apart from the name ‘IHG’, the group does not undertake any expenditure on behalf of the hotel, as all fees are paid directly from the hotel’s lean revenue.
“The disbursed sum is therefore net of any deductions whatsoever.”
According to the law firm, IHG has benefitted more than any other stakeholder in the hotel’s affairs, “if what had been paid to them since inception is contemplated”.
“They have refused to disclose the sums paid thus far to them since the commencement of the operations of the hotel. The sum of N173 million is what the receiver/manager has paid to them for a period of about six months,” it added.
While it noted that the hotel has been in operation for over three years, the statement pointed out that the receiver/manager has consistently requested for a meeting to review IHG’s charges to no avail.
“The hotel’s revenue cannot sustain IHG’s charges of almost N40 million monthly without further borrowings. Further borrowings based on the peculiar circumstances of the hotel is foolhardy as the hotel is currently indebted to two banks in excess of aggregate of over $100 million.
“A practical and more realistic approach is for IHG to sit down with the receiver/manager to work an acceptable package for the benefit of all concerned and not resort to mudslinging and persistent blackmail as they are attempting to do.
“Resort to blackmail is an avoidable red herring in the circumstances and it can’t work since the hotel cannot pay what it cannot afford/sustain,” Messrs Kunle Ogungba & Associates maintained.
IHG entered into an international management agreement with Milan Industries Limited, owners of InterContinental Hotel Lagos, in January 2012.
But the hotel group, in a notice of termination of the agreement dated January 3, expressed its displeasure with Messrs Kunle Ogunba & Associates who was appointed the receiver/manager by Skye Bank, following an interim court order.
According to IHG, it had on various occasions engaged the receiver/manager to ensure the proper management and operation of the hotel as part of IHG’s global hotel network.
“Despite multiple letters issued to the receiver/manager and Milan dated May 18, 2017, June 1, 2017, June 14, 2017, July 18, 2017, October 31, 2017, November 12, 2017, December 15, 2017, requesting the co-operation of the receiver/manager with IHG in order to ensure that the hotel maintains its operating licence and to avoid a material breach of the agreement, a significant amount of fees outstanding in the sum of $3,142,324/NGN995,223,818 owed to IHG remains unpaid and continue to accrue on a daily basis.
“Furthermore, Clause 16.1 empowers IHG to terminate immediately the agreement upon the appointment of an administrator or receiver over the assets of Milan, whereupon the marks, licence and software licence granted for the use of Milan by IHG shall cease; access of the hotel to IHG’s reservations system will be suspended and the management and operation of the hotel by IHG shall terminate,” it said in its letter to receive/manager which was made public on Tuesday.