Hotels group in talks with lender

Hotelier Sir Rocco Forte is holding crunch talks with a key lender after his upmarket golf and spa resort in Sicily breached loan agreements with its bank. Trading has been tough at the Verdura resort, which was forced to close temporarily, shortly after opening in 2009 due to a lack of bookings. In accounts filed at Companies House, Rocco Forte & Family warned: "Financial progress with the subsidiary has been slower than required to meet all the conditions of its existing facilities. "As a result, the long-term financing arrangements relating to Mediterranea [Verdura] are currently being renegotiated with Unicredit." While the £100 million (Dh582.02 million) loan to this subsidiary is separate from the £200 million Forte borrowed from Lloyds-owned Bank of Scotland for his 12 other upmarket properties, there was a worrying twist. The accounts state that if a deal cannot be struck with Unicredit, this could trigger a clause within the Bank of Scotland loans in which it could call in repayment of the £200 million. But Forte said discussions with Unicredit were going well and that he was also in talks with an unnamed third party who could take a strategic stake in Verdura. Sir Rocco said: "In an annual report, you have to paint an Armageddon scenario that just is not going to happen. I am completely relaxed that we can resolve the situation in a number of ways and that it is not going to be a problem at all." The privately-owned chain of 13 luxury hotels saw progress in trading over the year to April 30, 2011. It said a move to online marketing and an improvement in the economy helped shrink the pre-tax loss to £9.6 million from £24.9 million. Sales increased to £148.6 million from £130 million and managing director Richard Power said over the past 10 months to February, revenues were up 6 per cent and profit 13 per cent. From gulfnews