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Liquidators get nod to wind up unit of Park Hotel Management

Liquidators get nod to wind up unit of Park Hotel Management

Source: Straits Times
Article Date: 20 Nov 2021
Author: Grace Leong

The debt includes $5.92 million owed by former tenant Park Hotel CQ to Ascendas Hospitality Reit, the landlord of the former Park Hotel Clarke Quay.

The High Court ruled yesterday that the liquidators of Park Hotel Management (PHM) can wind up its wholly owned subsidiary Park Hotel CQ over $6.3 million in debt.

The debt includes $5.92 million owed by former tenant Park Hotel CQ to Ascendas Hospitality Reit, the landlord of the former Park Hotel Clarke Quay.

Park Hotel Clarke Quay was renamed Riverside Hotel Robertson Quay after Ascendas terminated the lease agreement and took possession on Aug 28 because Park Hotel CQ had failed to pay the $5.92 million by June 30.

Park Hotel CQ also owes about $592,000 to its parent, Park Hotel Management, under a management agreement.

"As of Aug 31, $6.3 million is owed by Park Hotel CQ. It is no longer carrying out any business and is clearly insolvent," said lawyer William Ong, who is acting for Park Hotel Management, also under liquidation.

Mr Aw Eng Hai and Mr Kon Yin Tong from accountancy firm Foo Kon Tan LLP, liquidators of Park Hotel Management, were appointed liquidators of Park Hotel CQ yesterday. "There are savings of time and costs if the same liquidators are appointed over Park Hotel CQ," Mr Ong told the court.

They will examine a series of multimillion-dollar transfers centred on Mr Allen Law Ching Hung, who is listed as the sole shareholder and director of Park Hotel Management, which until recently owned Park Hotel Group.

Mr Law is the former chief executive of Park Hotel Group and son of Mr Law Kar Po, who has an estimated net worth of US$6.1 billion (S$8.3 billion), according to Forbes.

Mr Ong said there is evidence that Park Hotel CQ transferred $2.5 million to Park Hotel Management in April.

"Mr Allen Law authorised the transfer even though he was no longer a director. The $2.5 million went to PHM to pay off a debt it owed to its bank," Mr Ong said.

"It appears a substantial portion of monies drawn down by PHM was used to pay Mr Allen Law."

There was an agreement dated March 8 when various hotel and IT assets amounting to $2.7 million were allegedly transferred out of Park Hotel Management.

"But PHM, the seller, did not receive this $2.7 million in cash. Instead, (it) was set off against amounts recorded as owing by PHM to Mr Allen Law in PHM's books. The liquidators are investigating this debt that is allegedly owed by PHM to Mr Law," Mr Ong said.

There is also evidence of interim dividends of 11.8 cents per share declared by Park Hotel Management allegedly in favour of Mr Law, he added.

In response to The Straits Times' queries, Mr Law said that "it is his position that the various transactions referred to were all proper and determined by bona fide commercial considerations".

Mr Law is married to Ms Tan Shin Hui, granddaughter of former UOB chairman Wee Cho Yaw.

She is the executive director of Park Hotel Group, whose portfolio spans Singapore, Japan, the Maldives, Hong Kong and China, according to its website.

Park Hotel Group now manages two hotels in Singapore, down from six, after the landlords of Park Hotel Farrer Park, Park Hotel Clarke Quay and Destination Singapore Beach Road terminated their management contracts following the winding up of Park Hotel Management.

In July, the High Court approved the winding up of Park Hotel Management over $5.2 million of debt owed in relation to the 308-room Grand Park Orchard, previously in Park Hotel Group's portfolio.

In September, Park Hotel Group said it terminated its management of Grand Park Orchard for "commercial and strategic reasons".

These developments have left Park Hotel Group running just Grand Park City Hall and Park Hotel Alexandra in Singapore.

Before Park Hotel Management's winding up, Park Hotel Group had its ownership changed to Park Hotel Group Management on March 8.

The new owner is wholly owned by a British Virgin Islands company called Good Movement Holdings. It has one director, Ms Tan, who was appointed on March 1.

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

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