No dividends for Libyans

Legacy Hotel Holdings chief executive Bart Dorrestein has pledged that his Libyan minority shareholders will not pay any dividends back to the Libyan government until the political situation in Libya stabilises.

The Mail & Guardian reported last week that Libya’s investment arm has extensive interests in South Africa’s leisure industry.

“We will not be affording Libyan leader Muammar Gaddafi any opportunity to handle his country’s investment concerns [in South Africa],” Dorrestein said this week.

Gaddafi is engaged in a bitter armed conflict with forces opposed to his regime and the international community is concerned that the Libyan dictator could use his country’s vast investments overseas to fund his fightback.

The United Nations Security Council passed a unanimous resolution two weeks ago freezing all assets belonging “directly or indirectly” to Gaddafi and his family, but many governments worldwide have extended the asset freeze to Libyan government assets as well.

The Libyan government’s investment arm, the Libyan Investment Authority, owns the Libya Arab African Investment Company (Laaico), which has a stake in South African tourism, leisure and real estate sectors through its 100% shareholding in Ensemble Hotel Holdings.

Ensemble owns the Michelangelo Hotel in Sandton and is a minority shareholder in Legacy, which owns or manages a portfolio of 19 luxury leisure and tourism properties.

Ensemble also owns the Radisson Blu Sandton Hotel, according to Maarten van den Niewenhuizen, the exiting regional director for Rezidor Hotels, the company that manages the hotel.

In the United States assets belonging to the Libyan Investment Authority have been frozen after state officials concluded they were controlled by Gaddafi.

The authority was founded in 2006 by Gaddafi’s son, Saif, and is currently chaired by Baghdadi Mahmudi, Libya’s prime minister and nominally the country’s second-most-powerful figure after Gaddafi.

Following the M&G report last week Dorrestein assured the public that neither Gaddafi nor his family owned a stake in Legacy Hotels and that Libya’s overseas investments were owned on behalf of the Libyan people.

Dorrestein said the M&G report had been “hugely damaging to our organisation and the morale in our company” after members of the public had threatened to boycott Legacy’s hotels.

“Our company is trying to resolve the fallout in a constructive manner and as a result we are taking the precautionary step of freezing our partner’s dividends.

“I imagine that this should show extreme goodwill on [the part of] all the parties involved and puts into context what a storm in a tea cup your article [caused],” Dorrestein said.

This article was produced by amaBhungane, investigators of the M&G Centre for Investigative Journalism, a nonprofit initiative to enhance capacity for investigative journalism in the public interest. www.amabhungane.co.za.

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