The eyesore Bermudiana Hotel could soon be razed to the ground and new office complexes built under plans announced by two insurance companies.

Last month Ace Ltd. and Exel Ltd. agreed to buy-out Winson Holdings Ltd. -- the owners of the derelict hotel -- from Argus Insurance.

The deal hinges on planning permission for any future scheme and an exemption from Bermuda's 60/40 rule which says any business must be at least 60 percent Bermudian owned.

Today the two companies will launch the Bermudiana Site Rehabilitation Act 1996 -- a private act that will seek permission to buy Winson and bypass the 60/40 rule.

If the Act is passed the Bermudiana will be demolished and the grounds landscaped -- in the first stage of the redevelopment process.

Preliminary plans for the site include the building of separate office complexes for the two companies, phased over a period of five or more years.

Both Ace and Exel say they will work closely with the Planning Department to develop plans in keeping with Bermuda's international business reputation and the Island's architecture.

However both companies have put a deadline of March 31, next year, for the Act to be passed and the deal completed or they will drop their interest.

"We plan to approach this development in a step-by-step fashion,'' said Ace chairman, president and CEO Brian Duperreault.

"The planned construction would be spread over a period of time, benefiting the local economy by providing significant employment opportunities,'' he added.

Brian O'Hara, Exel's president and CEO, said: "This is a unique opportunity for our growing businesses. "Both Ace and Exel have a long-term interest in Bermuda as an operating base and our joint venture underscores this commitment.'' The Bermudiana site was taken over by Argus, through Winson Holdings, after the Bermuda Financial Centre (BFCL) was unable to repay loans.

BFCL has been trying to develop the Bermudiana site but a major stumbling block has been cash-backing. Between Exel and Ace that cash -- possibly up to $100 million -- would be available.

BUSINESS BUC