- Family uses hotel as collateral to obtain bank loan to get hotel back from government
The grandchildren of Emperor Haileselassie paid 25 million Br, which they secured from Dashen Bank, required for the return of the Wabi Shebelle Hotel from the Privatisation and Public Enterprises Supervision Agency (PPESA) last week.
The PPESA decided to transfer the hotel, which was established in 1968 and nationalised during the Derg regime, back to the ownership of the royal family in 2008. However, it had asked that the money, which it claims the government had spent on the hotel while it was under its supervision, be paid before the transfer is effected.
The royal family did not have the cash to secure the 108-room hotel and approached banks for a loan, using the hotel as collateral, which the agency permitted as it was still under its supervision, in a letter dated October 2010.
Now that the money has been paid, the handing of the hotel back to the original owners is scheduled to take place this week, according to Wondafrash Assefa, head of Public Relations for the PPESA.
“The agency will return every asset of the hotel,” he said.
To transfer the title deed to the royal family, the Ministry of Trade (MoT) requires a clearance paper from both the agency and the Ethiopian Revenues and Customs Authority (ERCA).
The 11-storey hotel, which has close to 180 employees, is one of six hotels under the Wabi Shebelle Hotels Enterprise. It uses 90 out of the 108 rooms as bedrooms while the remaining ones are offices.
After the passing away of Prince Mekonnen, the emperor’s son who died in a car accident on Debre Zeit Road, the emperor had given the hotel as a gift to the former’s children.
“We are happy to get the hotel back,” Bedemariam Mekonnen, one of the children of Prince Mekennen, told Fortune. He declined to comment any further.
Source: Addis fortune