A Canadian company has bought the historic Hotel Tower on Main Street in a US$8M deal and yesterday announced plans for rebranding even as the Ministry of Labour initiated legal action to get the previous owners to pay the over $5M owed to workers.
The buyer, Panther Corporation of Canada, will in no way take over the responsibility of paying workers still owed by the previous owners.
“As of two days ago, we have arranged to purchase the Tower Hotel as well as the 200 acres towards Linden… the total acquisition is US$8M… this is a done deal we just have to get through the baby steps to get the deal done,” Mike Mosgrove, the President and CEO of Panther Corp, told a press conference yesterday morning.
He stated that the sale agreement was signed two days ago between himself and the majority shareholder of the hotel. While he refused to name who the majority shareholder was, Stabroek News understands that it is West Demerara businessman Salim Azeez.
On May 23 this year, the hotel abruptly closed. Workers protested after they were told through an anonymous phone call that letters were at the front counter for them. They said when they collected their letters, they learned that that day was the last day of work for them as the hotel was closing. The hotel subsequently said business had declined dramatically in recent times. It assured that assets would be liquidated to pay outstanding amounts to its employees, although it has subsequently broken several promises to pay them.
Mosgrove made it clear yesterday that his company will not be responsible for any liabilities of the hotel and debts incurred by the old owners would have to be settled by them. However, he said that since the deal should be closed in another month, he saw no reason why the old owners should not meet their obligations as they would have “more than enough money” to do so.
He further informed that the business was bought through a direct sale with the owner and not from a bank foreclosure. According to Mosgrove, the hotel still had “reasonable standing” with the bank and they were not in a foreclosure state.
“I am not buying the corporation that exists. I don’t want any of the dirty business. I want nothing to do with it. We are buying the assets of the building and the operation,” he stated.
“I am going to say it right out and I don’t care if anybody likes it or not. If there is a corporation and you just got US$8M from me, to do what you need to do, as far as I am concerned you should be paying your bills. It’s not for me to make him pay or not pay his bills, but you should be paying your bills. I suggest if you are getting that kind of money that there should be some action that can be taken to ensure that those people get their money and I fully agree,” he added.
Among the hotel’s debts is a total of $5,577,633 in wages, salaries and other benefits owed to 67 former workers. They were promised payments several times by Azeez, who has to date not given any commitments on when payments will be made after being given more time by the Labour Ministry. Fed up with not being assured, the Ministry of Labour yesterday moved to the High Court seeking to have the workers paid their due.
The Ministry, through its lawyer Pricilla Chandra, filed a summons asking that the court order the hotel’s management to pay up on debts to the workers and any other sum the court feels the workers should get. That matter will be called on November 10th.
Mosgrove signalled that there will be some rebranding of the entity as his company wants a new image for the hotel, which has in the past been hit hard with negative reviews. “I have a great interest in trying to keep the Tower as part of the name… [but] I think we have to rebrand it in some way shape or form [because] unfortunately the internet has been mean to that hotel. So, maybe we incorporate the name, maybe Georgetown Tower or something to that effect… make it a nice place to be,” he said.
Mosgrove said in addition to the Main Street property, the 200 acres Emerald Tower Resort, located along the Soeskdye Highway, was also a part of the sales agreement. He said his company is currently exploring design options for the resort. “It is an option for us to do a different type of resort for Guyana. It is a gorgeous area. It offers something to people that are coming here in the 20s and 30s demographic… we will make it a destination place for people,” he contended.
Mosgrove has signalled his interest in a waste recycling venture that the government has sought bids for.
