– NICIL Head
By: Kiana Wilburg
The investments made by the National Industrial and Commercial Investments Limited (NICIL), into the Berbice Bridge, the Marriott Hotel and Skeldon Energy Inc. (SEI) represent the worst mistakes ever made by the entity.
This is according to NICIL’s Head, Horace James.
Of the three investments, James said the worst would have to be the Marriott Hotel, followed by the Berbice Bridge and then SEI.
James noted that the board for the Atlantic Hotel Inc. is fully in place. AHI is the special purpose company that was established to see the smooth creation and running of the hotel.
The NICIL Head said that he knows the Board has been receiving unsolicited requests from persons who are interested in the construction of the Entertainment Complex and the benefits that might bring.
With this in mind, James said that the board is currently working out how they are going to deal with that in terms of advertising and construction of the complex.
“But Marriott International is managing the hotel. There is a contract between AHI and the International brand for that. In terms of the loans, the hotel is not making money to service the loans. In fact, the Government has to pay US$1.2M every six months,” James said.
The official said that while this cost should have been handled by AHI and/ or NICIL, the latter simply does not have the money. He stressed that “NICIL cannot stand on its own two feet”.
“So the government is helping out both AHI and NICIL. Marriott can become profitable, but I don’t think it should really be a government-owned institution. That is why I think government is looking and will continue to look for a model to sell the whole thing or some shares in it. There is a better possibility of getting something from Marriott.”
SKELDON ENERGY INC.
Skeldon Energy Inc. is a Special Purpose Company jointly owned by the Guyana Power and Light (GPL) and the National Industrial and Commercial Investments Limited.
Some years ago, the former CEO of GuySuCo, Rajendra Singh, sold the company’s generation facilities to Skeldon Energy Inc. for US$30M. To date, the Guyana Sugar Corporation has also only been paid US$19M of the agreed sum. SEI subsequently indicated that it could revise the outstanding US$11M amount.
With the co-generation plant in hand, NICIL’s Horace James is now saying that the investment into SEI was a huge mistake.
“A prudent business person would not have entered into those investments if the sole intention was to make a profit. Too much of the investments were to satisfy some social need and that was the biggest mistake. For example; NICIL’s involvement in SEI, as far as I am concerned, was to give GuySuCo money.”
James added that his conclusion is premised on the worrying fact that there was never any technical or financial reason to move the power plant from the sugar industry to GPL and NICIL combined.
In an interview with Kaieteur News, the NICIL Head said that the entity does not receive a single cent from its investments, especially in the case of the Berbice Bridge.
In this regard he said, “In fact, some of the private shareholders are bawling because up to now, they have not received anything from their investments.”
Presidential Advisor on Sustainable Development, Dr. Clive Thomas, believes that the contractual agreement for the Berbice River Bridge Inc. which allows NEW GPC and Hand in Hand Trust to own 50 percent of the entity when their investment is less than five percent is “outrageous, ruthless and unconscionable.”
New GPC, a company owned by Dr. Ranjisinghi ‘Bobby’ Ramroop has close relations to former President Bharrat Jagdeo and, according to an article on chrisram.net some time ago, that company has two Directors on the Board.
The structure of the company allows equity shareholders whose investment is less than five percent ($400 million) of the total funds of the company to exercise controlling interest over the company. Of the $400 million, the Ramroop Group owns 40 percent and the Hand-in-Hand Group owns 10 percent.
The contract also provides for the equity shareholders to receive 23 percent on their investments.
In light of this, Dr. Thomas said, “This contract agreement is clearly designed to make just a handful of people filthy rich for the rest of their lives at the expense of the poor. It is a despicable contract, which must be changed. The contract agreement and the implications for our taxpayers can only be described as criminal and I will insist that the Shareholder Agreement to be made public.”
The Presidential Advisor added, “It is clear also that under the past regime there was a disease of greed which infected every project, every plan and almost every entity. We are seeing this behaviour on display from the company. Government has a right to reduce the tolls. It is unconscionable to think that this entity wants to increase the tolls and suggest in any way that they want the government to consider extending their concession agreement.”
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