GlobeSt.com UPDATE: Sunterra Settles Finova Debt

ORLANDO-After cutting a court-approved, debt-settlement deal with Finova Capital Corp. of Farmington, CT for $105 million, locally based Sunterra Corp. officials are confident they may be able to emerge from Chapter 11 protection under the U.S. Bankruptcy Code by year end or sooner.

Sunterra had a debt load of $850 million when the once high-flying timeshare developer filed for protection in May 2000. The bankruptcy petition showed the timeshare firm had $1 billion of assets in 89 global resorts. Cypress Pointe Resort in Orlando is one of Sunterra’s more successful properties.

Sunterra paid off Finova from a $210 million, court-approved term loan package it had received in April 2001 from Greenwich Capital Markets Inc. of Greenwich, CT. The $105 million payoff to Finova equates to a discount from par of about $25 million, Sunterra officials say in a prepared statement.