Barnes Bay creditors committee seeks to stop discount sale of property

By Lisa Kerner

Charlotte, N.C., May 2 - Barnes Bay Development Ltd.'s official committee of unsecured creditors asked the U.S. Bankruptcy Court for the District of Delaware for declaratory and injunctive relief in an adversary proceeding related to the proposed sale of property, according to a Monday court filing.

The committee wants the court to enjoin the defendants from proceeding with or closing on the improper "discount" offers made to deposit creditors and prevent future improper solicitation by the defendants to the deposit creditors to close on units of the property, the filing said.

As previously reported, the committee asked the court in April to reconsider its approval of the sale of the company's Viceroy Anguilla Resort and Residences.

A hearing is set for May 13.

In Monday's motion, the committee says the debtors' proposed chief restructuring officer Kevin Nystrom contacted deposit creditors and urged them to execute a purchase and sale agreement for the residences, which are ready for occupancy, on or about May 13 in exchange for a "quick close" discount.

Barnes Bay, the developer of the Viceroy Resort and Residences in Anguilla, British West Indies, filed for Chapter 11 bankruptcy on March 17 to complete the sale of the property to a Starwood Capital Group-controlled affiliate that owns the $358 million mortgage on Viceroy Anguilla. The Chapter 11 case number is 11-10792.

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