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Thu 11 Mar 2010 06:57 AM

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Banyan Tree seeks winding up order over $1m Bahrain bill

Luxury hotels operators says it has filed petition against Al Areen to recover $1.1m.

Banyan Tree seeks winding up order over $1m Bahrain bill
HOTEL DISPUTE: The luxury Banyan Tree resort in Bahrain.

Luxury resorts operator Banyan Tree has said that one of its wholly-owned subsidiaries is taking legal action over an unpaid bill of more than $1m in Bahrain.

The unit, Banyan Tree Hotels & Resorts, has filed a petition in the kingdom to wind-up Al Areen Desert Spa and Resorts - the owner of Banyan Tree Bahrain - to recover $1.12 million, the company said in a statement.

Al Areen allegedly owes the money to the Banyan Tree unit under a hotel management agreement signed in March 2005 and a settlement agreement that both sides inked in November last year.

Banyan Tree said the winding-up proceedings "may be completed this year or next”.

“BTHR may be successful in the winding-up proceedings but may not be successful in recovering any amounts from it," the company statement added.

It said that if it was successful in the winding-up proceedings, the hotel management agreement would be terminated.

Al Areen were not immediately available for comment.

“It is common knowledge that the financial crisis has impacted several entities in the Middle East; to a certain degree, it has affected some of our hotels. We endeavour to operate with the highest standards, and if we are unable to settle issues amicably, we need to defend our own credibility and as a matter of principle, take a firm position with regards to any breaches and outstanding debts.," Banyan Tree added.

“While we remain committed to the GCC region and will continue to explore opportunities, it is very important that we find like-minded partners who sincerely share our vision and demonstrate a commitment to the Banyan Tree brand experience."

The company said it had five other projects under development in Abu Dhabi, Egypt and Oman.

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