Millennium & Copthorne Hotels Regulatory News (MLC)

9 Mar 2005 07:09

Millennium & Copthorne Hotels PLC09 March 2005 Wednesday 9 March 2005 Settlement ofMillenium Hilton Property Damage and Business Interruption Loss Insurance Claim Millennium & Copthorne Hotels plc ("M&C") is pleased to announce that itswholly-owned subsidiary, CDL Hotels USA, Inc. ("CDL"), has on 8 March 2005entered into a settlement agreement (the "Agreement") with Travelers PropertyCasualty Company of America (formerly known as Travelers Indemnity Company ofIllinois) ("Travelers"), the insurance company which provided to CDL an all riskexcess property insurance policy (the "Policy") in respect of CDL's hotelproperties in the United States for the period from January 1, 2001 to January1, 2002. Under the Agreement, Travelers has agreed to pay to CDL a cash amount ofUS$24.99 million in full and final settlement of CDL's actual and potentialclaims against Travelers under the Policy for losses (including property damageand business interruption) sustained at the Millenium Hilton as a result of theSeptember 11, 2001 terrorist attack. Payment of the amount will be made on orbefore 14 March 2005. Prior to entering into the Agreement, Travelers had madecash payments under the Policy in respect of the losses at the Millenium Hiltonin the aggregate amount of US$50.01 million. Following the payment of the finalamount under the Agreement, Travelers will have paid a total of US$75 million inrespect of the Millenium Hilton. This total amount paid by Travelers, togetherwith the US$10 million paid by CDL's primary and first excess insurers in 2002,will bring the total amount of insurance proceeds paid in respect of theMillenium Hilton to US$85 million. The US$24.99 million (£13.1 million) payment under the Agreement, net of legalcosts, will be recognised in the profit & loss account of the M&C group in 2005. As part of the Agreement, CDL and Travelers have agreed to mutual releases ofall claims or other actions either party has or may have against the other partyunder the Policy. Following payment and receipt of the US$24.99 million underthe Agreement, CDL and Travelers will make the necessary applications to theUnited States District Court for the Southern District of New York to dismisswith prejudice all outstanding legal actions of the parties against each otherunder the Policy. Enquiries: David Cashman, Group Chief Financial Officer 01293 772288Millennium & Copthorne Hotels plc Kate Miller 020 7404 5959Brunswick Group LLP This information is provided by RNS The company news service from the London Stock Exchange