(Trinidad Express) The energy assets of CL Financial (CLF) have almost been sold out for small sums.
And Proman Holdings, through its consortium Consoli-dated Energy Ltd (CEL), is set to acquire its second lucrative company, Methanol Holdings Trinidad Ltd (MHTL).
Proman Holdings is chaired by Joseph Cassidy who is also a director of MHTL.
Insurance company CLICO has to abide by the decision of the International Court of Arbitration and sell its 56.53 per cent shareholding in MHTL for US$1.175 billion (TT$7.485 billion) to Consolidated Energy Ltd (CEL) in 14 days.
On February 4, 2009, Proman (through CEL) acquired CLICO Energy Limited, just three days after the then-People’s National Movement (PNM) Government signed a memorandum of agreement with former chairman Lawrence Duprey on January 30 to provide an initial $5 billion to rescue CLICO, CLICO Investment Bank and other financially troubled subsidiaries.
The Switzerland-registered company had issued a cheque for CLICO Energy for US$47 million but the Government objected to the quick sale, initiated court proceedings and instructed that the transaction be reversed.
The reversal of the sale was itemised in the Shareholders Agreement signed on June 12, 2009 between CLF shareholders and the Government.
Under item 6 titled ‘Proman/ Clico Energy’ it stated: “The present directors shall use their best endeavours to procure the reversal of the sale.”
In May 2012, both CL Financial and CLICO issued pre-action protocol letters to Proman Holdings Ltd as it sought to recover 51 per cent of CLICO Energy Ltd .
CLICO wanted to recover its 17 per cent interest while CL Financial is seeking to recover its 34 per cent interest in CLICO Energy.
CLICO Energy remains in the hands of Consolidated Energy while the matter is still before the court.
That sale was subject to extensive examination during Sir Anthony Colman’s Commission of Enquiry. Former finance director Michael Carballo had told the Commission that CLICO Energy was valued at over US$200 million, had been sold for a paltry US$46.5 million.
CLICO Energy, Carballo had explained, was one of three assets, the other two being MHTL and Republic Bank Ltd owned by CLICO, which CLF depended on for cash.
In 2011, CLF’s energy company Primera was sold to Canadian oil company Touchstone Exploration Inc for US$50.7 million (TT$326 million).
Primera has 16 oil and gas properties comprising seven onshore producing oil and gas properties, one onshore exploration property, one offshore exploration property and seven undeveloped properties.
Since the Shareholders Agreement between the Government and CLF shareholders was signed in June 2009, the government has sought to recoup its investment from the illiquid company.
The Government intervened and bailed out CLF in January 2009. The Shareholders Agree-ment allows the sale of CLF assets to pay off CLICO policyholders.
The Sunday Express understands that despite Government’s disappointment over the Court’s valuation of the MHTL shares, there is no room to appeal the decision given that both parties had agreed to be bound by it.
The award by the International Court after an almost year-long arbitration to determine the value of the MHTL shares followed a November 2013 ruling that all of CLICO’s shareholding be sold to CEL.
CLICO had submitted three valuations from international firms- Duff and Phelps, Deloitte (London) and Union Bank of Switzerland (UBS) with MHTL’s worth ranging from US$1.6 billion to US$2.2 billion.
The Sunday Express understands that CEL had valued the shares at US$875 million.
