Golden Tulip Hospitality Group has moved into voluntary receivership (a kind of corporate bankruptcy whereby a receiver is appointed by bankruptcy courts or creditors to run the company) blaming declining occupancy rates and the cost of investing in new hotels.
The responsibility of the receiver is to recoup unpaid loans or company obligations. Being in receivership is not an enviable position because, oftentimes, receivers look to pay back loans by liquidating the company's assets, which effectively puts the company out of business.
Golden Tulip has over 780 hotels in its portfolio, 60 of which it owns outright.
A statement by Golden Tulip said, "The general decline in the leisure and hospitality sector due to the recession, have also had their impact on Golden Tulip, especially outside the Netherlands and Belgium the occupancies have declined substantially in the last three quarters."
Reports talk of a possible merger with Apollo Hotels & Resorts and private equity firm H2 Equity Partners.