Government Tuesday announced plans to put the Hilton Barbados Resort, valued at more than US$100 million, up for sale.
Minister of Finance Chris Sinckler disclosed the move as he presented the 2017 Financial Statement and Budgetary Proposals while broadly addressing the privatization of state entities.
He told Parliament that Government agreed to relinquish its ownership of the prime property given its substantial investment in the Wyndham Sam Lord’s Castle, estimated to be in the range of US$250 million.
“Government believes that, in keeping with its policy to limit the number of hotels properties it holds within its assets portfolio, that now would be a good time to divest itself of the Hilton while preparing to welcome the Wyndham Sam Lord’s Castle into the fold.”
He revealed that the Barbados Tourism Investment Inc and the Ministry of Tourism and International Transport will be receiving, analyzing and recommending bids to Cabinet for the sale of the luxury resort.
The Needham’s Point property first opened its doors as Barbados became an independent nation in November 1966 and has remained one of the island’s best known hotel properties.
In 1999 it was demolished and rebuilt six years later.
Sinckler told the House, the hotel, which is operated by the Needham’s Point Holdings Limited, has been making a profit for the last six years.
He stressed that Government will only be accepting offers in line with the hotel’s real value.
“If a successful bid is accepted, Government is expecting to receive no less than BDS$100 million as the net proceeds from the sale, taking into account the liquidation of existing debt liabilities attached to the property. Provision for these proceeds have already been taken account of in the 2017/2018 Estimates of Revenue.”
The announcement comes as the Freundel Stuart administration seeks the shore up the island’s fast depleting foreign reserves, which stood at $749 million, or near 11 weeks of import cover at the end of last week.
The Freundel Stuart administration has been banking on the sale of the Barbados National Terminal Company Ltd. (BNTCL) –– which is owned by Barbados National Oil Co. Ltd. (BNOCL) –– to the Sol Group.
However, the US$100 million sale is now tied up in the law courts after Rubis challenged the sale which is yet to be approved by the Fair Trading Commission (FTC).
“It is expected that this [FTC ruling] should come during this financial year and so the expected boost to both foreign reserves of $100 million and revenue of $70 million will assist Government in tackling both of the major challenges confronting it at this time,” he said.
Sinckler told the House that Government was not afraid to divest appropriate state assets but it would not engage in selling entities, which provide social services to the public.