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The collapse of a 15-hotel deal has forced Anbang Insurance Group and Mirae Asset Global Investments into a virtual trial this week in Delaware, each suing the other for alleged breach of contract.
The $5.8B deal, which includes the Essex House in New York and Westin St. Francis in San Francisco, soured as the U.S. hospitality sector began to crumble amid the coronavirus pandemic, The Real Deal reported.
Chinese holding company Anbang accused South Korean-based buyer Mirae of reneging on the deal over fears of a declining market, and the Mirae accused Anbang of using "absurd" strategies to get the deal done, according to complaints made by both parties, TRD reported. Both deny the other’s allegations.
Mirae Asset Global Investments also alleges that Anbang attempted to raise the price of the deal by $1B, while Mirae allegedly tried to push the price down by $2B or stall the deal until after the crisis, TRD reported.
Anbang, which also owns the Waldorf Astoria in New York separately, purchased the collection of hotels in 2016 for $5.5B, only $3M less than the price it was set to sell it to Mirae Asset for in April.
Blackstone previously owned the portfolio and has expressed interest in potentially buying it back while it was being marketed, Bisnow previously reported.
In 2018, the Chinese government found Anbang's former chairman, Wu Xiaohui, guilty of fraud and embezzlement, leading to a state takeover of the company.
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