week launched a public share offering aimed at raising up to $4.6 million.

The public offering, which closes on Friday, October 8, is intended to help meet the $14.5 million purchase price of British hotel group Forte Hotels' property.

The entire project is estimated to cost $131 million, although the developers have warned that this figure could swell in the future.

The minimum amount the development company Bermuda Financial Centre Limited (BFCL) says must be raised by the public offer is $1 million. The most the offering can raise $4.6 million after payment of fees.

BFCL has won the exclusive right to negotiate with Forte Hotels to buy the property.

A prospectus released on Monday stated that only convertible preferred shares are being sold, at a price of $8 per share.

Up to 625,000 preferred shares are available for subscription under this offer.

Gordon Capital Corporation (GCC), a Canadian investment banking firm, has been hired to help secure $131 million to develop the centre.

In turn, GCC has engaged First Bermuda Securities to assist in the financing.

First Bermuda Securities president Mr. Jeff Conyers said that so far the offering had received verbal commitments for subscribers, but "no-one has written a cheque yet''. However, he believed there was "a good chance the offering would be oversubscribed.'' "Preferred shares were selected for the offering in order to protect the shareholder,'' he said.

Preferred shareholders will be entitled, in priority, to $4 per share in the event of liquidation.

Although preferred shares have no voting rights, they will receive the same dividend per share as ordinary shareholders.

And preferred shares may be converted into ordinary shares on a one-for-one basis after December 31 1995 at the option of the preferred shareholder.

He said the project was "not a riskless transaction''. The prospectus warns prospective investors that the sale of the Bermudiana has not yet been finalised. It also offers no guarantees about the success of the share offering and other planned offerings. It points out that BFCL will forfeit $250,000 is contracts are not exchanged by October 11.

If completion of the deal does not occur on December 7, 1993, BFCL will forfeit $1.4 million, 10 percent of the purchase price.

"There can be no assurance that the Company will complete the acquisition of the property by this date,'' stated the prospectus.

A factor that may have an adverse effect on the venture is an unexpected fall in tourism and business arrivals once the development has been completed.

Another concern expressed is that BFCL may not get all the regulatory approval needed to go ahead with the plan. Mr. Fraser Butterworth, partner at architects Bath/Butterworth and one of the developers, said he expects to submit plans to the Development Applications Board by mid-October.

Officials from the Corporation of Hamilton have opposed the commercial zoning of Bermudiana hotel site, saying it could create an undesirable, sprawling city.

But Mr. Butterworth said there should be no concern about the erosion of park land at the Bermudiana site. "The hotel will be in a more park-like setting,'' he said.

Mr. Conyers added "the whole front will continue to be park land. The building will be mainly located on the Gorham Road and Woodbourne Avenue and Bermudiana Road side of the property. If anything there will be more access to park land.'' The prospectus said Winworth Ltd., whose directors are the Hon. Michael Winfield, Mr. Butterworth and Cambridge Beaches Hotel executive assistant manager Ms Heather Robinson, will be paid $11,000 per month from July 1993 until BFCL owns the Bermudiana property. After the sale, Winworth will be paid $26,000 per month until development of the site is complete.

BFCL will pay Winworth five percent of any unspent portion of the construction budget. BFCL will also pay Winworth either $300,000 per annum or five percent of the net operating income for the project. Winworth will also be paid $100,000 to cover agents and broker expenses.

Winworth's main objectives are to hire architects; get Government permission and financing for the project; organise a PR programme, and arrange security.

GCC will get eight percent of the preferred shares subscription proceeds for its services as financial advisor. GCC's fees will total 4.1 percent of the entire project financing.

The Canadian company GCC's involvement did not reflect any prospective Canadian shareholding in the venture, Mr. Conyers said.

He said Ms Joslin Bennett, a GCC partner, had "had much to do with getting the deal''.

First Bermuda Securities also anticipate raising finance by issuing participating convertible debentures and senior secured notes. The debentures are expected to be issued in November, 1993 and senior notes arranged in early 1994.

The majority of the funds -- $86 million -- raised under this financing plan will be allocated to the construction of a new hotel and business complex once the existing structure is demolished.

Interest and bank fees are apportioned $20 million, property acquisition, $15 million and professional fees, $10 million.

First Bermuda Securities expect to raise $6 million in preferred shares; $40 million in convertible debentures and $85 million in mortgaged notes.

So far, 250,000 preferred shares are in issue. First Bermuda Securities made a private placement of the shares at $4 each on September 9 to raise $1 million initial finance to negotiate the deal with Forte, according to Mr. Conyers.

"It had to be done this way because we were involved in delicate negotiations and did not want to advertise what we were doing,'' said Mr. Conyers.

The prospectus names Mr. Winfield, who is the company's president as one of BFCL's directors. Other directors are Mr. Butterworth, and Ms Robinson, who are both BFCL vice-presidents, and a fourth director, GCC partner Ms Bennett.

BFCL company secretary is Mr. Michael Ashford of Conyers, Dill & Pearman.

Contracts have been signed with engineers Luchini Milfort Goodell & Associates, Inc. Anfossi and Butterfield are retained as accountants.

BFCL intends to build a five-star hotel with 300 rooms and suites, three office buildings and a 1,000-seat business convention centre. Other features are underground parking facilities, executive condominiums, concessions and retail shops. The company is currently negotiating a management agreement with international hotel management companies.

HOTEL DEAL -- The Bermudiana Hotel is slated for demolition if Bermuda Financial Centre Ltd.'s purchase agreement with owners Forte is completed. The Hon. Michael Winfield.