A group of 1,100 Harlequin investors is proposing to make an offer to the company's chairman, David Ames, to put the troubled overseas property company's assets in a trust while a managed wind down of the business is achieved.
Ames requested an offer from the Harlequin Investor Group (HIG) on 9 June, according to law firm Regulatory Legal, which set up the group and is acting on behalf of investors.
An alternative offer has been proposed by boutique investment and advisory firm Eleven Capital but, according to Regulatory Legal, it would require investors to put up £20m in finance pledges in addition to the £400m they have already invested, which investors are unwilling to do.
Under the HIG plan, investor interests will be held in an investor trust which 100% owns an operating company.
HIG will seek to appoint an operating company to run the viable Harlequin resorts, one which has a developed travel agency network to attract occupancy to the resorts.
The group will also appoint agents to sell the assets of Harlequin which are deemed non-core to maximise return to investors.
The HIG bid will not require Financial Conduct Authority approval, which would mean it could be enacted relatively quickly.
Regulatory Legal said HIG will require financing in the short to medium term; the amount will depend on the current state of the finances at Harlequin, information which the law firm said it has been unable to obtain from the company.
Depending on the amounts involved, HIG could ask investors to assist in the financing of the investor-led Harlequin, or a negotiation could take place with a lender to fund against the resort assets held by the investors.
"Investors are more likely to back themselves than an Ames-led vehicle," a statement from Regulatory Legal said.
"A Harlequin with happy investors will be more likely to obtain external finance to supplement any investor finance. We do not know the size of the funding hole as yet as we have not been allowed to undertake due diligence. We will campaign hard for the right to bid on a level playing field."
HIG will not offer to pay Ames or his family any money.
"Non-delivery is not a trigger point for reward," said the statement from Regulatory Legal.
HIG is asking Ames and his advisers to allow investors access to the same information as the commercial entities that are currently involved in the process, and said this is information that is currently being withheld.
HIG will prepare a bid and openly publish it to investors.
Harlequin is currently at the centre of an investigation by the Serious Fraud Office and Essex Police.
In a statement Harlequin said: "Harlequin is currently undertaking a restructuring process and has retained experts to assist with this.
"Eleven Capital has been engaged to look at future funding mechanisms for on-going development and operations. Eleven Capital is talking to a number of potential lenders and critically assessing their ability to provide suitable financing.
"As with any potential lender or institution no commercially sensitive information would be released until that potential lender satisfies a number of prerequisites.
"Harlequin is aware of the Gareth Fatchett partner at Regulatory Legal led approach made to Eleven Capital, that it understands is being considered along with other financing options in accordance with standard corporate governance procedures."
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