Dorrestein’s Legacy buys back Hotels from Libyan partners

A years-long stalemate between hotelier Bart Dorrestein’s Legacy Hotels and minority shareholder the Libyan Investment Authority has been resolved.

This follows the Supreme Court of Appeal’s ruling on 21 July 2026, that the sovereign wealth fund’s shares in the business be repurchased by Legacy at fair value.

This will therefore see the exit of that entity as a shareholder.

The parties have been in litigation since 2022 to resolve the deadlock.

Ensemble Hotel Holdings (ultimately a vehicle of the LIA) owns 39.79 percent of Legacy Hotels and Resorts, having purchased the stake through the Libyan African Investment Company (Laico) in 1999.

Dorrestein owns 40.84 percent directly (through Legacy Management Holdings).

On the other hand, Swanvest (controlled by Dorrestein) owns the remaining 19.39 percent.

The LIA sought to buy out Dorrestein’s stake in the business in 2024, when Ensemble approached the South Gauteng High Court (Johannesburg) seeking an order for a private auction.

The plan was to allow either party to outbid the other, a request that Dorrestein publicly described at the time as “suicidal” as it would pit him against a sovereign wealth fund.

The court found in Ensemble’s favor, and Dorrestein then took this on appeal.

SCA rules

This ruling has been found defective by the Supreme Court of Appeal.

The dispute has also kept the iconic all-suite Michelangelo Hotel on Nelson Mandela Square shut for the past five years. It is still fully furnished, but it never reopened following the Covid-19 lockdown.

The newer Michelangelo Towers has been operating.

Ensemble argues that the battle originates from moves by Legacy Hotels to explore the transfer of hotel management contracts to Legacy Hospitality, in which Ensemble held no interest.

The majority of Legacy directors said this was necessary “to protect Legacy Hotels’ business from the reputational impact of Ensemble’s connection to the sanctioned entities”.

But Ensemble characterized them as the “unlawful diversion of corporate opportunities”. That November 2021 proposal was withdrawn in March 2022.

Two transfers did, however, take place.

On renewal, the management contracts for Kuzuko Lodge (in the Eastern Cape) and the Swakopmund Station Hotel were concluded in the name of Legacy Hospitality.

Legacy says it welcomes the SCA judgment which “finally brings to an end the long-running shareholder dispute that has affected the company for several years”.

It says “the litigation was frequently publicly portrayed as a so-called ‘hostile takeover’ of Legacy Hotels & Resorts”.

The judgment “demonstrates that this characterization was misplaced”.

“The judgment preserves the Legacy business, protects its stakeholders and provides a clear and orderly mechanism to bring the shareholder relationship to an end”.

Dorrestein says the court’s “decision enables Legacy to move forward with certainty, stability and a renewed focus on its people, its hotel owners, its guests and the continued growth of one of Southern Africa’s leading independent hospitality groups”.

Aside from its five properties in Sandton, Legacy also owns and/or manages hotels and resorts in Cape Town (The Portswood and The Commodore – both owned by V&A Waterfront and effectively Growthpoint Properties and the GEPF/PIC), in the Kruger area (Elephant Point and Kruger Park Lodge), the Pilanesberg (Bakubung, Kwa Maritane and Tshukuku) as well as Namibia (in Swakopmund and Windhoek).

The Leonardo, a 55-storey mixed use property in Sandton and Africa’s tallest residential skyscraper, was a development between the Legacy Group and Nedbank.

The repurchase of Ensemble’s shares by Legacy is conditional on ministerial permission under section 26 of the Financial Intelligence Centre Act (Fica) within six months.

This is due to UN sanctions imposed on Libya which means the transaction would constitute dealing in frozen property, which is prohibited under Fica. The fair value, as of 29 January 2021, is to be determined by an independent expert (a senior chartered accountant from EY, KPMG, PwC or Deloitte, absent agreement) and will have the power to apply “marketability” or “minority” discounts.