(Trinidad Guardian) The United Shareholders Limited’s plan to deal with Clico’s residual debts to Government envisages that CL Financial retain control of six companies—including Angostura Holdings Limited, Colfire Ltd and Home Construction Ltd—and that there be a joint approach among shareholders and Government to steer Clico’s future.
This is part of a letter of April 25, 2016, sent by Roger Duprey (chairman CL Duprey Investment Trust Ltd) to Finance Minister Colm Imbert on the plan.
USL has represented Clico shareholders on matters since 2012, following collapse of the former insurance giant in 2009 when the then Patrick Manning People’s National Movement government had formulated a bailout plan. The subsequent People’s Partnership administration continued efforts on the matter. The current Dr Keith Rowley-led PNM administration, in its first budget last year, pledged to resolve the matter.
Imbert reached out to USL in April for input, following which USL submitted its April 25 letter with its proposals.
But after subsequent Government statements on the direction being taken with CL assets and other recent developments, USL and other combined Duprey family interests sent Government a blistering letter of concern on Monday (July 25) alleging suspected Government “betrayal and deception” in the Clico matter and seeking answers on its suspicions. In particular it highlighted that Government had “reneged” on an undertaking to provide USL with a statement of the debt that is owed to Government for the Clico bailout and on its undertaking not to dispose of the assets of the group pending proposed discussions.
Imbert told T&T Guardian on Wednesday that he will deal with the matter when he returns from his foreign assignment.
In USL’s earlier April 25 letter to Imbert, they noted a call on April 20 by Imbert to USL chairman Kirk Carpenter and Imbert’s request to identify “what the CLF shareholders want and expect, and what has been previously discussed with the Government.”
In that letter, Duprey stated, “We agree Government needs to have a firm plan for full and final settlement of this long outstanding matter which started in 2009. We’ve prepared the following points that will not only give the shareholders’ views, but also ensure Government is repaid in the soonest possible time.”
The letter noted that in an effort to formulate a debt repayment plan on the agreement, the USL, acting on behalf of CLF and its shareholders—and after resolutions of CLF shareholders of May 2012—held discussions with the Finance Ministry on this. But parties were unable to reach consensus on the final amount of the Government debt.
In May 2013, a third extension of the shareholders’ agreement was done. It was envisaged that a new shareholders’ agreement would have been finalised, but this was delayed up to the September 2015 general election. It was noted that the current Government, “in order to give itself time to consider the economic situation of the country, requested a six-month extension to April 30th, 2016.”
The letter added, “USL, upon consideration of that extension request, needed to have it made clear that neither party to the shareholders’ agreement could veto the other party’s director nominations. That matter was never addressed and accordingly, the shareholders never signed the extension that was sought. It is our understanding this matter will be resolved soon.
“In any event, it was the shareholders’ understanding that purpose of any extension of the shareholders’ agreement was to facilitate the completion of negotiations in relation to a new shareholders’ agreement and the implementation of the Heads of Agreement. (HOA).
“We, shareholders, were therefore somewhat taken aback by the Honourable Minister of Finance’s plan for CLF as articulated in the recent mid-year budget review. A plan which does not reflect the substance and tenor of previous discussions between Government and CLF Shareholders or the concrete proposals contained in the HOA, but which articulated the sale of certain CLF assets, including its interests in Angostura Holdings Limited and land assets of Home Construction Limited.
“Such sales being contemplated as they appear to be, in the midst of an economic downturn, cannot be in the best interest of CLF, its shareholders, creditors and other stakeholders, including the taxpayers of T&T whose objective is and in whose best interest it is to maximise the amounts obtained from any sales of assets.”
CLF shareholder representatives therefore obtained a meeting on April, 13 2016, with Imbert, newly-appointed Government representatives to the CLF Board and Central Bank representatives.
The letter added, “Despite the lengthy period of time over which the CLF Shareholders’ requests have been made, shareholders have not been able to fully quantify the actual debt owed to Government and have been unable to reach agreement on a timeline for repayment on the amounts owed by the company.
“This has hindered shareholders in their ability from using their voting powers to assist CLF and its affiliates in taking steps to ‘correct’ the financial position of Clico, Clico Investment Bank and British American by its repayment to Government so that funds advanced by taxpayers can be paid in full.”
