Wena seeks help for Egyptian hotel ‘theft'

Wena Hotels has asked the International Centre for the Settlement of Investment Disputes (ICSID) to halt the sale of the Nile Hotel in Cairo, which it alleges was stolen from it by the Egyptian government.

It has also advised potential buyers, their agents, and the Egyptian Minister of Foreign Affairs against demolishing or altering the hotel before Wena's $62.8m (£36.7m) compensation claim against Egypt has been settled by ICSID in Washington.

British-based Wena claims the government "unlawfully expropriated" both the Nile Wena and the Luxor Wena after selling it long leases on the state-owned hotels (Caterer, 30 July, page 11, and 10 September, page 8).

While admitting that he did not know the full history of Wena's claim, Amro Sheta,associate director with investor Commercial International Investment Company, said his firm had "made a bid to purchase a plot of land. Whatever is on itis not any concern of the new buyers - we are not party to this dispute."

But Wena vice-president Nael Farargy claimed that investors had been "misinformed" and should seek advice from an international lawyer. He said that the lease Wena signed for the Nile hotel in 1990 covered "the entire parcel of land and the building erected thereon" and warned that it might take legal action against anyone investing in the hotel before the dispute is resolved.

The Egyptian government was unavailable for comment. Crisp in Blunt, the Conservative MP for Reigate who represented Farargy's case to the Foreign Office, expects to meet the Egyptian ambassador this week.

He described the expropriation of Wena's hotels as "truly appalling" and "very unattractive" to potential investors in Egypt's tourist industry. As secretary of the Conservative Middle East Council, he felt that it bordered on what might be expected from a "bandit regime", and that Egypt should be better than that.

By Angela Frewin