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BTL bought and paid for Print E-mail
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Thursday, 17 September 2015 00:00

headline.jpg - 55.52 KbOn Monday September 14, the government announced that it had come to a settlement in the BTL matter putting to an end 6 years of litigation over the price for the company. In making the announcement, Prime Minister Dean Barrow explained that the negotiations were completed after two meetings with Michael Ashcroft in May and August of this year and thereafter correspondences via e-mail.

The negotiations were described as fast and furious by the Prime Minister and it culminated with government agreeing to a payment of 162.7 million Belize dollars to be paid to British Caribbean Bank (BCB) and the former owners of BTL.

When government nationalized BTL it assumed a 22.5 million dollar loan which BCB had given to BTL but even as it did so BTL’s new management maintained that the loan was illegal. That led BCB to initiate arbitration under a 1982 Bilateral Investment Treaty between the Government of the United Kingdom and the Government of Belize for the promotion and protection of investments. On December 19, 2014 the Arbitral Tribunal ruled in favor of the Bank and ordered the Government to pay compensation. As part of the settlement, the Government agreed to pay the Bank US$48,544,927.78 representing compensation, including costs, expenses and interest on the original 22.5 million dollar loan.

Additionally government will be paying Dunkeld International Investment Limited which had shareholdings in BTL through various companies and the BTL Employees Trust which had shareholdings through its company Sunshine Honding Limited. Dunkeld held 71.2 percent shareholding while Sunshine held a 23 percent shareholding. Dunkeld will receive partial payment at the rate of US$0.72 per share for 34,107,117 shares totaling US$24,557.12; and another partial payment to the Trustees of the BTL Employees Trust also at US$0.72 per share for 11,092,844 shares totaling US$7,986,848. These payments are in line with a valuation done by NERA Economic Consulting.

In explaining the payment sources the Prime Minister was clear to inform that it is basically BTL that will be making the U.S. 48 million dollar or 97.4 million Belize dollar payment with the government first fronting it and BTL acknowledging that it is their debt. He said that the government will issue treasury notes to the tune of 48.5 million dollars. BTL will come up with 10 million in cash, an additional 15 million dollars will be gotten from BTL dividend payments which had been frozen by the CCJ. 19 million dollars will come from Petro Caribe and 4 million dollars will be had from the money which was secured from the sale of BTL shares after nationalization.

As for the payment of the shares, PM Barrow stated that he does not expect the tribunal to rule for payment beyond the NERA valuation for which payment is already being made but in the event that it does the difference between the NERA valuation and any tribunal award will be made in two payments. Half of the amount will be paid within 10 days and the balance within a year.

There is also the element of the tribunal’s decision in the unlikely event that it takes into consideration the Accomodation Agreement under these circumstances the PM stated that the payment will be separated and described as the restricted amount the payment of which will be in Belize dollars and the money will be spent in projects identified the government with agreement by the other party.

Last Updated on Thursday, 17 September 2015 18:28