https://www.dawn.com/news/1602706Farewell Roosevelt Hotel
Khurram Husain Published January 21, 2021
LET me start with an apology. If you’re still busy absorbing the full magnitude of the sheer stupidity that went into the making of the Broadsheet scandal, I have more bad news for you. The Roosevelt Hotel in Manhattan as well as the Scribe Hotel in Paris, both iconic landmarks in their respective cities and prized assets of the national airline, have been seized (or ‘charged’ in legal language) by a court order in the British Virgin Islands (BVI) as settlement of the liability to the Tethyan Copper Company (TCC) to whom Pakistan lost an international arbitration case after cancelling the contract that awarded them the Reko Diq gold and copper mines.
Here is what the BVI court said. “The following property in the Territory be provisionally charged … to secure the sum of $3,114,339,607.50 namely a) 100% of the shares in the capital of PIA Investments Limited BVI Company … b) 100% of the shares in the capital of PIA Hotels Limited ... c) 40% of the shares in the capital of Minhal Incorporated….”
It continues: “To the extent that the Shares yield or pay income, dividends or other forms of value, the provisional charge shall extend to” all of these as well. The court has scheduled a hearing on this “provisional charging order” for March 15, and the Attorney General’s office is already on record saying they will fight the order. PIA is a listed company and has not yet made any announcement to its shareholders via the Pakistan Stock Exchange website about this provisional charging order. But the order itself is public information.
In July, plans were finalised for a joint venture under a long lease via a cabinet committee decision and the Roosevelt Hotel was placed on the active privatisation programme. By August, they were talking about a proposed transaction structure, hiring of financial advisers and inviting expressions of interest from domestic and international parties for interest in a long lease on the Roosevelt Hotel and making the investments necessary to convert it into a mixed use facility. Some reported estimates that fluttered through the news flow during these days said the required investment could approach $1 billion. This was no small transaction they were seeking to undertake.
In September, the Economic Coordination Committee, another cabinet body, approved the allocation of $142 million for settling various “financial requirements” of the hotel. By October, the news broke that the hotel would be closing its doors permanently, fixed on their website along with a sentimental farewell note. The news was denied vehemently at first, the notice on the website removed, but later it proved to be true. A few weeks later, the CEO of PIA told a Senate committee that the hotel will be closed for “renovation” on Dec 31.