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. Last Updated: 07/27/2016

Slavjanskaya Hotel 'on Verge of Bankruptcy'

Fed up with feuds between the American managers of the Radisson Slavjanskaya Hotel, the Russian partner in the enterprise is demanding an audit of the joint venture which it says "is on the verge of bankruptcy." Nikolai Gushkov, deputy chairman of the Moscow Property Committee which owns the four-star hotel and 50 percent of the joint venture that runs it, threatened Tuesday to intervene to help end the feud. "I'd like to see this squabbling between the partners come to an end," Gushkov said, adding, "It puts both us and the Americans to shame." The feud peaked over the weekend when Vladimir Draitser, the hotel's general director, barred Paul Tatum, president of the Americom Business Centers in the Slavjanskaya and one of the hotel's four directors, from entering the building. The public battle in Moscow's only American-run hotel, which hosted U.S. President Bill Clinton in January, came in the aftermath of a police raid on the hotel bar Friday in which alleged gangsters were detained at gunpoint. Tatum was banned after he cut off Draitser's phone lines, tried to break into his office and ordered banks to deny the director access to joint accounts. Tatum said that Draitser's contract had expired and insisted he leave his office, but Draitser was supported by Radisson and representatives of Gushkov when he insisted that his contract is indefinite. Americom, which runs a business center, a chain of shops and other services in the hotel, and Radisson Moscow Corp., which manages the hotel's rooms and restaurants, are also fighting in U.S. courts over their half of the joint venture. The hotel, which has one of the city's highest occupancy rates and is the usual hostelry for visiting American officials, owes the Moscow city government $12 million in lease payments but does not have the means to pay, Gushkov said. "The hotel is on the verge of bankruptcy," he said. Gushkov said he will order an audit of the venture's accounts to find out who is to blame, and where the money has gone. The Moscow Property Committee, in charge of city-owned enterprises until they are privatized, has appointed the Mosintour hotel chain to manage the committee's 50 percent share in the hotel's management. But Gushkov said he was far from satisfied with Mosintour and was considering replacing the company's representatives on the hotel's board of directors. Mosintour officials declined to comment. Draitser agreed that the joint venture owed rent to the city but added: "Whether we are on the verge of bankruptcy or not is hard to tell." "We have a healthy cash flow," Draitser said in a telephone interview Tuesday. "But we have no other sources of financing." Draitser said the hotel had been forced to use revenues to finance reconstruction when attempts to obtain loans failed, leaving little funding to repay debts to the city. He added that, when the venture was set up in 1991, political instability discouraged investors. But the infighting in the hotel's management has also scared off investors, Draitser said. Draitser declined to confirm or deny the $12 million debt figure. Tatum on Monday said the hotel owed $8 million. Bulky guards still keep Tatum out of the hotel, but his staff have been let in and continue to work. Draitser said Tatum would be banned from entering the hotel until the board of directors meet next week to discuss the conflict. In the United States, Radisson is seeking to have its partnership with Americom dissolved, leaving Radisson as the hotel's manager and Americom as manager of a separate business center in the hotel, according to Tom Polsky, spokesman for Radisson at the headquarters in Minneapolis, Minnesota. Americom, in turn, has taken Radisson to court, claiming that Radisson illegally boosted its share in the venture from 20 percent to 54 percent when Americom defaulted on some of its investment.