Kerzner International said today that it would transfer ownership of Atlantis and One&Only Ocean Club in The Bahamas to a Canadian property company in a debt-for-equity deal.

Kerzner said it had reached an agreement with Brookfield Asset Management, Inc. to assume ownership of the properties in exchange for taking over $175 million in debt.

Under the deal, Kerzner International Holdings Limited would continue to manage Atlantis, a huge complex with more than 3,000 hotel rooms, a water park, nightclubs and the Caribbean's largest casino.

The resort is a distinctive property but, like the tourism industry in general, has had to slash room prices during the recession. The company had been trying to restructure more than $2 billion in debt.

"This transaction will permit Kerzner to move forward as a management company, allowing us to get back to doing what we do best, designing and managing world-class destination and luxury resorts under the Atlantis and One & Only brands," Sol Kerzner, the chairman and CEO of Kerzner International, said in a statement.

Brookfield, based in Toronto, is a global asset manager with approximately $150 billion in assets. The transaction is subject to approval by the Bahamian government.

Prime Minister Hubert Ingraham is expected to make a full statement on the matter when the House of Assembly meets this afternoon.

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