LONDON, UK— Le Meridien, the privately owned luxury hotel chain here, is said to be under the control of its banks after its shareholders reportedly wrote off their investments in the firm. It was noted The Sunday Telegraph carried a story contending financial problems at Le Meridien had spawned big losses for its backers, including Royal Bank of Scotland and Japan’s Nomura. No immediate response was gleaned from Le Meridien. As spelled out, Le Meridien was bought for approximately US$3 billion in May 2001, with the majority of the economic interest in it held by Terra Firma Capital Partners, the private equity firm led by Guy Hands that grew out from Nomura’s Principal Finance Group. It was similarly reported The Sunday Times said bankers had called a crisis meeting for May 19 with the hotel chain after it breached bank covenants. Reports said Le Meridien had failed to recover from the slump in tourism after the Sept. 11, 2001, attacks, compounded by the Iraq war and outbreak of SARS virus. SOURCE: Reuters
