Receivers of the failed finance company Bridgecorp are seeking legal advice after Fiji's military government issued a decree effectively seizing control of the Momi Bay development.Bridgecorp was closely linked to the Fiji-registered developer Matapo, but
Receivers of the failed finance company Bridgecorp are seeking legal advice after Fiji's military government issued a decree effectively seizing control of the Momi Bay development.
Bridgecorp was closely linked to the Fiji-registered developer Matapo, but construction of the $US127.5 million tourist project was affected after the military coup in 2006.
Bridgecorp collapsed in July, 2007, owing $459 million, and its largest loan was to Momi, where it had a $49.1 million exposure when work stopped after the coup.
Bridgecorp's receivers Colin McCloy and John Fisk of PricewaterhouseCoopers are investigating what to do. A spokesman said they had tried to stop the military regime issuing its decree.
They had been considering how money could be recovered from the abandoned tropical resort for the 14,360 Bridgecorp investors. The resort failed to sell at auction last August, when bidding was reported to have stopped at $NZ29.54 million.
Fiji's National Provident Fund pension scheme has $US40 million from 300,000 members invested in the project and interim Attorney General Aiyaz Sayed-Khaiyum said continuing legal battles with Matapo were holding up the chances of further development or sale of the property.
Mr Sayed-Khaiyum said the fund's exposure to the Momi development included accumulating interest, continuing legal bills, cost of a mortgage sale, the auction and cost of maintaining the property.
His decree ensured that the fund could either continue the development of Momi Bay or sell it to interested parties, the Fiji Times reported.
"The state found it was essential and imperative that the fund acquired proper ownership of the stagnant tourism project so it could realise the securities that the fund held in Momi," the newspaper said.
The fund had expected a significant loan to the project to be repaid by September 2007. Last month, it said it had written down $F327 million, including $F18 million on the resort.
Mr Sayed-Khaiyum said that about 50 caveats – legal claims on the title – had been placed by various parties and this had delayed efforts to sell the property to some other interested developer who could finish the work.
