Polaris World has 3 months to negotiate “amicable” solution with creditors
Posted on January 5, 2010 by Mark
Filed Under Developers & developments, Murcia | 1 Comment
Polaris World Golf resort in Murcia
Polaris World, Spain’s biggest developer of golf resorts, has 3 months to negotiate an “amicable” solution with its creditors after admitting that it has “temporary liquidity problems in some of its subsidiaries.”
If no agreement is reached in the 3 month period, Polaris World will be forced to seek court protection from its creditors, following in the footsteps of other big Spanish developers like Martinsa-Fadesa.
Back in the summer of 2009, when Polaris World was renegotiating its debts with its main banking creditors, it was reported to have debts of 900 million Euros. Today the company claims it “only” owes 100 million Euros.
But the company is also having to deal with demands for payment from its contractors. Polaris World hopes to use this 3 months period to “amicably resolve the debts it has with them.”
Polaris World is made up of more than 20 divisions developing residential golf resorts and offering associated services. According to the company all divisions are “up to date with payments, and hoping to go forward without being forced to seek court protection from creditors.”
But according to a recent article in the Spanish daily El Pais, up to 15 of Polaris World’s subsidiaries are in a state of insolvency. Among them the management companies of resorts Hacienda Verde, El Valle Golf, Hacienda Riquelme and Alhama Golf, and hotels Mar Menor, Golf Hotel y La Torre Polaris Hotel.
Polaris World has developed 5 golf resorts in Murcia since its launch in 2001, with 65% of sales reportedly to retired British investors.
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[...] Polaris World took the first step towards bankruptcy proceedings back in December last year, when it took advantage of a provision in the law giving companies in financial distress 3 months of breathing space to negotiate with creditors, in the hope of avoiding the more drastic step of court administration. The deadline passed on March 22, but PW announced would continue negotiating for another month, during which time it should have gone into administration, in theory. [...]