GuySuCo blames NICIL for putting divestment of estates at risk
The Guyana Sugar Corporation (GuySuCo) is blaming the National Industrial and Commercial Investments Limited/Special Purpose Unit ((NICIL/SPU) for the current troubles with the divestment process, saying that the Unit has left it in the dark about the sales of its own assets.
In a strongly-worded statement in which it accused the SPU of unprofessionalism, GuySuCo criticised NICIL’s approach to the divestment. According to GuySuCo, NICIL has been slothful and because of this, has not executed any major investments with the process approaching its second year.
“NICIL/SPU’s single role was to divest GuySuCo’s assets from the Skeldon, Rose Hall, East Demerara (Enmore) and Wales estates; however, due to its slothfulness and less than credible ‘divestment’ tactics, it has now placed at risk the retooling and restructuring of GuySuCo as it is clearly outlined in the Government of Guyana (GoG) State Paper on the Future of the Sugar Industry,” GuySuCo said in its statement.
“NICIL/SPU, having been unable to divest the assets in a timely manner, convinced its principals that the Bond was an appropriate alternative as an interim financial arrangement; the divestment process is now approaching its second year and NICIL/SPU has not executed one significant investment.”
In addition, GuySuCo slammed NICIL for the current arrangement that sees it pocketing proceeds from the assets it did divest. GuySuCo claimed that it should be the other way around, so that the Corporation could fund its own strategic plan.
“As a matter of fact, in an attempt to extend the life of the SPU, having been created for the specific purposes above and within a particular timeframe; the agency has now assumed the role and operates as a proprietor and landlord. This is totally inconsistent with its intended purposes,” the Corporation complained.
“Additionally, GuySuCo is still awaiting a full report from NICIL/SPU on all and any transaction(s) which were completed or are in progress in relation to its immoveable and moveable assets, including the scrap metals, machinery, plant and equipment.”
This is telling, as in April of this year, reports had emerged that scrap metal from GuySuCo worth $3 billion was sold to a mysterious buyer, but the proceeds from the sale were not received by the Corporation.
The Government has been silent on this transaction, with former Business Minister Dominic Gaskin distancing his Ministry from the sale when questioned by <<Guyana Times>>> in April. The Business Ministry has overall responsibility for the scrap metal trade.
Nor is that all. According to GuySuCo, it is yet to be informed by NICIL about the extent of the valuation done by PriceWaterhouseCoopers (PWC) into its assets, information others, including Opposition Leader Bharrat Jagdeo, have repeatedly called for.
Since the valuation was done, the report done by PWC is yet to be released to the public. In its statement, GuySuCo questioned whether all the estates, including cultivation and other assets, were valuated.
GuySuCo also refuted recent claims made by NICIL that it has not been cooperating and has been withholding information. It insisted that it has in fact been providing information about the Estates for the divestment process – with the records to back it up.
GuySuCo expressed the view that NICIL/SPU used its June 3 press conference, where the claim was made that among other things GuySuCo has not been cooperating, to distract the public from the slow pace of divestment.
In GuySuCo’s statement, it provided the dates for every document it handed over and the persons receiving them. The documents date all the way back to November 20, 2017, when the fixed asset registers for Enmore, Rose Hall and Skeldon Estates were handed over.
In this and several other cases, the documents were handed over to NICIL’s in-house lawyer Arianne McLean. In other cases, however, the documents were handed over to other employees at NICIL.
Other documents include the minutes of board meetings and operating statistics from the Enmore Estate. GuySuCo even claims it provided the Enmore Estate field map, hectares per bed layout and the Enmore cane nursery size in 2018. Details from other Estates were also provided, GuySuCo said, including information on the soil.
Another allegation refuted by GuySuCo in its statement was the claim that it has requested duty-free concessions for the purchase of luxury vehicles from the $30 billion bond NICIL raised for the recapitalisation of the Sugar Estates. According to GuySuCo, the only vehicles it requested duty-free concessions for were double- and single-cab pickups for normal agricultural use in the sugar cane cultivation.
Even as the controversy continues regarding the divestment of GuySuCo’s assets, concerns have already been expressed about what will happen if Government defaults on the $30 billion bond it arranged last year. In such a case, bondholders would have the option of levying on NICIL’s portfolio of assets, which include the Marriott Hotel.