The 231-year-old Greenbrier resort in West Virginia–the place where the Council of Insurance Agents & Brokers was founded more than 95 years ago–filed for bankruptcy yesterday.
The hotel, based in While Sulphur Springs, W.Va., applied for Chapter 11 protection "to help ensure the viability of the resort," the Greenbrier Hotel Corp. said in a statement.
Under an agreement, the hotel will be sold from its parent company, CSX Corp. to Marriott Hotel Services.
In the meantime, the Greenbrier said it has obtained financing from CSX to remain in business while the sale is completed.
Under terms of the deal CSX corporation will provide $50 million to the Greenbrier to continue operation to be used in operating the resort until the deal is complete. The funds will be paid out over a two year period.
Marriott will pay between $60 million and $130 million within seven years, with the "actual amount depending on the timing of the payment and the Greenbrier's financial performance."
The transaction is contingent upon union and management coming to an agreement that is acceptable to Marriott. If an agreement is reached it is expected the deal would be made final later this year.
A labor dispute, which has been ongoing for over a year, led the CIAB to cancel its annual meeting at the hotel and move it to Lake Las Vegas, Nev., for 2008.
This year, to avoid getting caught up in the labor dispute, the CIAB said it hold its annual 96th Insurance Leadership Forum at the Broadmoor in Colorado Springs, Colo. Other meetings that the CIAB has run at Greenbrier in the past have also been moved there.
"It is a sad day for the Greenbrier, but it may signify a new chapter for the institution," said Ken A. Crerar, president of CIAB. He blamed the labor problem for the Greenbrier's financial difficulties, saying "the labor dispute drove it to bankruptcy."
Asked if the CIAB has plans to return there, Mr. Crerar said, "It all depends on what the Greenbrier is and what Marriott does. If they restore it to the grand resort it was then we will consider it. It is hard to make a prediction on whether we will go back until we know what it is we would be going back to."
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