InterContinental Group Threatens to Pull out of Nigeria


• Hundreds of workers may lose their jobs
• Receiver Manager: Hotel group is being unreasonable, matter will be resolved

Davidson Iriekpen

The InterContinental Hotels Group (IHG), the multinational hotels company headquartered in the United Kingdom, has threatened to pull out of Nigeria by January 18 over a breach of contract and huge debt owed it by the receiver/manager appointed by Skye Bank Plc.

The IHG, which entered into a international management agreement with Milan Industries Limited, owners of InterContinental Hotel Lagos, in January 2012, had in a notice of termination of the agreement dated January 3, 2018, expressed its displeasure with Messrs Kunle Ogunba who was appointed the receiver/manager by Skye Bank following an interim court order.

Should the British hotels group make good its promise, hundreds of Nigerians working for the Lagos hotel may find themselves without jobs.

According to the IHG, “We had, on various occasions, engaged the receiver/manager to ensure the proper management and operation of the hotel as part of IHG’s global hotel network.

“Despite multiple letters issued to the receiver/manager and Milan dated May 18, 2017, June 1, 2017, June 14, 2017, July 18, 2017, October 31, 2017, November 12, 2017, December 15, 2017, requesting the cooperation of the receiver/manager with IHG in order to ensure that the hotel maintains its operating licence and to avoid a material breach of the agreement, a significant amount of fees outstanding in the sum of $3,142,324/NGN995,223,818 owed to IHG remains unpaid and continues to accrue on a daily basis.

“Furthermore, Clause 16.1 empowers IHG to terminate immediately the agreement upon the appointment of an administrator or receiver over the assets of Milan, whereupon the marks, licence and software licence granted for the use of Milan by IHG shall cease; access of the hotel to IHG’s reservations system will be suspended and the management and operation of the hotel by IHG shall terminate.

“Take note that this letter formally serves as notice of termination of the agreement with effect from January 18, 2018.”
The Milan Group, an Indian family-owned conglomerate with over 40 years of trading in Nigeria, had taken a facility from Skye Bank to part finance the five-star hotel located in Victoria Island, Lagos, and managed by IHG.

The Milan Group, it was gathered, had up till 2021 to pay back the facility but in a curious move, the bank obtained an interim order to take over the management of the hotel.

The takeover did not go down well with IHG, which has severally complained about the manner the receiver/manager has been going about the assignment, culminating amongst other issues: “Failure to pay in full and on time all amounts due to IHG,” developments the British hotel group considers a fundamental breach of the existing agreement.

The IHG also complained in an earlier letter dated December 26, 2017 that it was “highly concerned that the hotel’s payroll has been suspended until after the Christmas holidays”.
“This is a further breach of the agreement, and we insist that all relevant payments are made to hotel employees immediately,” the hotel group said.
IHG further complained that the service delivery level was being impaired by the omissions highlighted in its letters.

Attempts to reach the receiver manager, Ogunba, proved abortive, but a source close to his law firm informed THISDAY that IHG was trying to blackmail both the bank and the receiver manager.
The source said the group had become a leach to the hotel, adding that since the law firm took over the hotel as receiver manager, it had paid the group N173 million.

He said what IHG had failed to acknowledge is that the resources from the hotel can no longer sustain its operations, wondering why the group was always demanding the little the hotel makes.
“They want to use blackmail to get an unfair advantage over the resources of the organisation and that is not fair,” the source said, adding that whatever the grievances, they would be resolved.
“We are currently engaging them in order to resolve the issues,” he noted.

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  • sunday government

    If we must tell ourselves the bitter truth, it is that we (Nigerians) do not have the capacity to run an hotel. All the hotels doing well in Nigeria today have international brands managing them. The receiver/manager should ensure that subsisting agreements are serviced and honoured. If IHL leaves, it will further aggravate the finances of the hotel. Just imagine if all software platforms associated with IHL are withdrawn?

  • Express Information Nigeria
  • Romla

    Like Etisalat like Intercontinental hotel.Many of us observed right from the opening of this hotel that it was nothing but a cosmetic mirage and that it’s failure was only a matter of time.
    The building construction had many defects which were clearly visible to the eye all covered up by a glass exterior which they thought had hidden the low quality construction.The central air conditioning is some parts of the building stooped working,a few months after opening.Parts of the glass exterior were falling off about a year after.
    The service and management was well below average.Some of us know the scam.The Nigerian partners and the top echelon of the bank have made their money from mismanagement of the loan.The whole deceitful business plan presented when the loan was requested for,is not implementable and achievable.The international partners have been scammed.Some Nigerian businessmen and bankers are nothing,but shortsighted con men and crooks.They forget that other international investors are watching.They end up making it more difficult for other honest Nigerian business men to convince foreign investors to partner with them.

    • Jon West

      This is a nation of simple conmen posing as businessmen. Like typical Niggers, they are totally consumed by the genetic dysfunction of instant gratification, never able to wait for genuine and sustainable progress. That is why ,sixty years after Independence, nothing seems to work in any facet of national life and the people are regressing intellectually and socially into the abyss of underdevelopment and failure, in the mist of abundant resources.
      As stated by an African American preacher, “The Nigger ain’t got no sense, he doesn’t know how the world works, he never built anything”. Our problems are endemic and therefore probably genetic- this obsession with the dopamine effect of instant gratification, in spite of the glaring evidence from other races, that real gratification requires patience, effort and sheer honesty. To hell with Nigeria and its Niggers!!!

      • jellybelly

        Happy New Year, Jon.

        • Jon West

          Happy New Year to you too. Hope the Certificateless One lets us have some happiness. However, the prognosis is not good.

      • lord vuga

        Too much grammar very little logic or sense.

        • Ekun

          No. Don’t do that. There was logic in that Grammer. The butt of the gist was captured in the last paragraph.

          • Bas Michael

            I agree completely with what Jon said. Its cold, its hard but damn it … its the truth!

      • Toby


      • Iskacountryman

        jon west…you nailed the analysis…but ended with your familiar refrain…happy new year…dont forget to buy dangote cement for the house you are building in nigeria…

        • Jon West

          Happy New Year , but where are my Fulbe maidens?

          • Iskacountryman

            did you convert?

  • Update-Update
    • Iskacountryman

      dangote …go and buy advert space…stop awoof…

      • Ekun

        Lol. Right. To a rational human being this is a scam. Advertise at the lowest or no cost at all.

        • Iskacountryman

          the owner of the newspaper should sue the so called richest man in africa…