Roosevelt hotel PIA: Rs 275m approved for legal battle
Aftab Ahmed
Islamabad: The government has approved Rs 275 million grant for payment of attorneys’ fees and other legal charges in connection with the PIA’s Roosevelt Hotel court case.
Earlier, the Economic Coordination Committee (ECC) of the Cabinet has approved up to $142 million packages for the Roosevelt hotel in New York. This will help to meet the financial challenges of the hotel.
Aviation Division had recently requested the economic coordination committee (ECC) to include representative of the attorney general of Pakistan in the committee.
It also discussed the matter to the extent of attorney’s fee and allocation of technical supplementary grant to pay fee and legal charges. Aviation Division further said that Finance Division had backed to allocated funds to pay legal charges through technical supplementary grant.
ECC considered the agenda of ‘financial challenges of Roosevelt Hotel New York-request for government support’ and decided to approve technical supplementary grant of Rs 275 million equivalent to USD 1.8 million in favour of Aviation Division.
Aviation Division will pay legal charges of attorneys relating to Roosevelt Hotel, PIA owns.
According to details, the Adviser to the Prime Minister on Finance and Revenue, Dr. Abdul Hafeez Shaikh, chaired the Economic Coordination Committee (ECC) of the Cabinet in Islamabad on Wednesday.
The EEC has decided for approval of amount up to $142 million for PIA-IL. The package was approved on the recommendation of the Committee constituted in an earlier meeting of the ECC. Deputy Chairman Planning Commission heads the Committee. But it also includes secretaries of the Finance Division, Aviation Division, and Law and Justice Division.
A New York-based Investment firm MSD has dragged PIA-owned Roosevelt Hotel in Manhattan, New York, into a debt trap by design to acquire it.
MSD Partners is an SEC-registered investment adviser that utilizes an investment strategy focused on maximizing long-term capital appreciation.
Sources told Newztodays.com that Roosevelt Hotel Corporation has obtained a loan of US$ 105 million from JP Morgan (lenders) at an interest rate of 5.05 percent with maturity in April 2021. The annual interest payment is USS 6.0 million approximately.
However, JP Morgan has sold its loan of US$ 68.250 million to MSD PCOF Partners XXI, LLC (MSD). The selling of JP Morgan’s portion of the loan to MSD has further complicated the situation for Roosevelt Hotel Corporation due to some reasons.
