hotel property it has been managing for 33 years.

Sonesta president Mr. Paul Sonnabend yesterday confirmed talks are underway with owner Aetna Life Insurance Company of Connecticut.

An announcement of a sale could be made within a week.

The purchase of the 25-acre, 400-room South Shore site would signal renewed confidence in the Island's future as a tourist destination.

In recent years the company has worked to improve bad labour relations of the late 1980s as well as financial results that regularly forced it to close in the winter.

A legal notice printed in The Royal Gazette indicated Sonesta would effect the purchase through a new company called Bermuda Sonesta Hotels Ltd.

The company is authorised to "engage in and carry on the business of owners, operators and managers of hotels, restaurants, cafes, shops stores and boutiques''.

In addition, the company would be allowed to "acquire and hold in its corporate name any estate or interest in the land'' on which the Sonesta Hotel sits.

The Sonesta property was put on the market last year by Aetna, which had taken it from owner VMS Realty Partners of Chicago in 1992. At the time, VMS was having financial difficulties. Its hotel company had missed more than a year of monthly payments to Aetna on its long-term $42.5 million mortgage.

When Aetna put Sonesta on the market in 1993, the managing director of the Bermuda Hotel, Mr. David Boyd, said the sale offer would test the property's value as well as the health of the tourism market and the industry's future.

Mr. Boyd declined to comment yesterday.

Mr. Sonnabend, who was contacted at Sonesta headquarters in Boston, also declined to elaborate on the negotiations until they were complete.