Dubai hopes that its purchase of passenger liner the Queen Elizabeth 2 (QE2) will become profitable in 10 years, according to Khamis Buamim, chairman of QE2 Holding, a new entity created to manage the ship’s transformation into a luxury hotel.

The emirate purchased the boat in 2008 for $100m, and it has largely sat unused since then in Dubai’s Port Rashid.

Buamim says that at least $90m will now be spent updating the boat to function as a 400-room luxury hotel in Asia. Ownership of the vessel has now been transferred to a new holding company, QE2 Shipping, which is a Dubai government entity. It was previously held by a subsidiary of Istithmar, a Dubai World subsidiary which originally planned to operate the ship as a floating hotel and tourist attraction moored on the Palm Jumeirah. That plan was dropped as a result of the financial crisis and Dubai World’s $25bn debt restructuring.

In October the QE2 will set sail for Asia to be overhauled. Design firms are currently being approached for the contract to redesign the boats interior

“The ship will continue to be owned by the Dubai government, we will not be selling it,” says Buamim. “There is no need to sell.” He added, “We are not scrapping it and we are not destroying it.”

A separate company, QE2 Holding, which includes the Dubai government and additional private investors, will manage the QE2.