Government Adopts Decision to Transfer Hotel Company Shares to City of Hvar

ZAGREB, 11.1.2007.

On Thursday, the Croatian government adopted an official decision to transfer 25% plus one share in the “Sunčani Hvar” hotel company to the City of Hvar and thus give a chance to the local community to actively participate in the making of strategic decisions on the company's future development, said Prime Minister Ivo Sanader.
In return, the City of Hvar will give up all further claims towards the “Sunčani Hvar”, which will provide for lifting all mortgages on the company and for entering a new cycle of investment in the company.
Deputy PM Damir Polančec said the shares would be transferred after the recapitalization of the company and the signing of an agreement between the 47% owner, Luxembourg's Orco, and the City of Hvar, whereby the latter will give up all other claims regarding the “Sunčani Hvar”.
Sanader said that as the 37% owner, the government would invest about HRK 32 million in the recapitalization, of which the City of Hvar would invest HRK 15 million.
He said the share transfer decision was important not only for the company, but also for the City of Hvar which alongside Dubrovnik and Opatija he said was among the most attractive tourist destinations in the world.
The PM added that the issue of ownership in the “Sunčani Hvar” had been settled on the model used for the “Liburnia Riviera Hoteli” (LRH) hotel company.  He said the government had already made the political decision to transfer LRH shares to the City of Opatija, and called on Opatija and the Croatian Privatization Fund (HFP) to implement the decision.
The transfer of 25% plus one share will settle the property-rights disputes between the “Sunčani Hvar” and the City of Hvar, and there is also a proposal to settle property disputes with the Catholic Church.
Speaking of claims of the former owners of the company's real estate, Sanader said he had first heard of them yesterday from the media and that he would ask the HFP to brief him on this matter.
The Minister of the Sea, Tourism, Transport and Development, Božidar Kalmeta, said the issue of restitution of land to former owners should be found within the new law on construction and tourist land, whose draft the government is expected to discuss soon.