Jul 03, 2018 News
– Opposition notes decline with suspicion; wants explanation
It is still unclear how exactly the Government of Guyana’s share in Guyana Stockfeeds Limited (GSL) has been reduced to seven percent from 38 percent. But the Opposition seems assured that Government made “a deal.”
Opposition Leader Bharrat Jagdeo said that it is “despicable” that Government would act in the manner he perceives. Jagdeo recalled that in 2008, the National Industrial and Commercial Investments Limited (NICIL) won a High Court case restoring its 38 percent shareholding in Guyana Stockfeeds. He said, “when we left office it was at 38 percent, so I do not know how it went back down to seven percent. Government has to explain.”
However, Minister of Finance Winston Jordan is refuting Jagdeo’s claim that “a deal” has been struck. This was during a recent telephone interview with Kaieteur News.
At the time of the interview, the Minister was not sure as to the percentage of Government shares in the entity. He made it clear, however, that government is just trying to get out of the company completely.
Jordan said, “We were trying to sell out our shareholding in Guyana Stockfeeds. We had it advertised in the daily newspaper.”
However, despite the advertisements, Government’s bid to sell has so far been unsuccessful.
Jordan said, “It was not sold, because the only interested buyer was the man who owns Guyana Stockfeeds (Robert Badal) and the price he wants to pay is not good for us….We cannot sell it at that price, because his shares on the stock market suggests that our stake in the Stockfeeds is far higher than what he wants to pay. But being a typical businessman, if he is the only person who is interested in the shares then he will offer low.”
While his explanation on the reason why Government has not been able to sell its seven percent was clear and detailed, Jordan could not offer the same detail in explaining how it is that the share got so low in the first place.
In fact, he did not even confirm what the current share is.
Jordan said, “If what you are saying is true, it can only mean that you had a share issue, but we did not sell whatever shareholding we had. To be quite honest, maybe we should go back and start investigating all those privatizations. Who got what and how they got it.”
Jagdeo thinks that government’s decision to sell its shares is a calculated move to benefit Badal.
Last year, when the advertisement was placed, Jagdeo said that the decision to sell was “pre-mature.”
He stated, “No announcements were made in the budget. It is not even clear if the Privatisation Board, appointed in 2015, is operating, and what’s the current policy of APNU/AFC on privatization. One only has to recall the 1992 World Bank report on the PNC privatisation era, which criticised the PNC programme as lacking transparency and accountability. APNU/AFC seems destined to return to this era.”
Further, Jagdeo said that it is a “well-known fact that GSL, although a publicly traded company, has been operated by Mr. Badal in a manner that is prejudicial to its minority shareholders, particularly the second largest shareholder, NICIL. Over the 20-plus years since the privatisation to Mr. Badal of 35%, Mr Badal has quietly taken majority control of the company, and then used the company at the expense of its other shareholders.”
Also, Jagdeo said, “At the genesis of NICIL’s 38% shareholding are Badal’s efforts to undercut the Government shareholding in 2000, when it increased the authorised shareholding of GSL from 700,000 shares to 100,000,000 shares, or over 140 times.”
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