Resolution Fund quizzes NB over hotel sale

 In Bankruptcy and liquidation, Banks, News, Real Estate

The Resolution Fund, which was set up to provide financial lifelines to Novobanco, has questioned Novobanco on the sale of a hotel in Brazil.

The former Sheraton Reserva do Paiva in Recife was part of a raft of soured investments made by the former Benfica boss Luís Filipe Vieira. The hotel is now in the hands of creditors Novobanco which now wants to sell the hotel to the Spanish Meliá Group.
However, the sale operation will require the green light go-ahead from the Resolution Fund that has provided billions of euros to keep the bank afloat during a long and painful restructuring process.
The fund has asked the bank to clear up certain questions about the sale of the hotel. The sale competition has aroused interest from various candidates and, despite a final decision still pending, Novobanco (which is responsible for the loans and assets of the former Benfica president) wants to select the Spanish international hotel group Meliá, instead of the Grupo Vila Galé, which had made the best offer to date in the auction.
The green light is needed from the Resolution Fund because the development is covered by a €3.9Bn public guarantee associated with the sale of Novobanco to Lone Star.
Last year, the real estate property portfolio belonging to the developer Promovalor, which is owned by Luís Filipe Vieira, was transferred to the Special Alternative Investment Fund (FIAE) for Development and Tourism held by Novobanco.
The fund holds 23 real estate assets in Portugal, Spain, Brazil and Mozambique, with a commercial value of around €244.3 million, including the former Sheraton Reserva do Paiva.