NICIL should probe Jagdeo’s sale of lucrative GTT shares

Jul 05, 2016 News

Auditor, Anand Goolsarran

…Govt never got a cent from New GPC shares – Goolsarran

Which investor in the world would make an investment and not receive a return on that investment for 17 years? Where is the Guyana Revenue Authority on this?

Forensic Auditor, Anand Goolsarran, is taken aback that the Board of the National Industrial and Commercial Investment Limited (NICIL) is yet to discuss the fact that the entity has not received a cent in dividends from New GPC over the last 17 years.
Goolsarran said that NICIL should have looked into the matter as priority because there seems to be more to the story than what meets the eye.
NICIL forensic audit report, prepared by Goolsarran, highlighted, “There was no evidence that the New GPC paid any dividends to the Government for its 10 percent stake in the company.”
Ninety per cent of the shares in the company belong to Dr. Ranjisinghi ‘Bobby’ Ramroop, the best friend of former President Bharrat Jagdeo.

Former Director of NICIL Winston Brassington

Chairman of NICIL’s Board of Directors, Dr. Maurice Odle, recently told Kaieteur News that NICIL is yet to discuss the matter moreover, look into trying to retrieve dividends.
He said, “Firms don’t always pay dividends even when huge profits are being made.” Dr. Odle noted the possibility that New GPC may have decided to keep the money to reinvest.
However, that remains a supposition as NICIL is yet to contact New GPC to get an understanding as to why dividends were not being paid.
Yesterday, Goolsarran admitted that indeed a company is not obliged to pay dividends when it makes a profit, especially if funds are needed for reinvestment. That decision has to be made by the Board of Directors of that company and ratified by shareholders at the Annual General Meeting. However, he said that it is unheard of for a company not to receive dividends over a 17- year period.
“I don’t know what representation NICIL has on the Board of the New GPC. Neither do I know whether New GPC has been holding Annual General Meetings. However, it seems incomprehensible to me that for 17 years, the company has not declared any dividend,” said Goolsarran.
The Auditor and anti-corruption advocate questioned, “Is it a case where New GPC has not turned out a profit in these years? If so, how has it been able to survive? Which investor in the world would make an investment and not receive a return on that investment for 17 years? Where is the Guyana Revenue Authority on this?”

Former President Bharrat Jagdeo

Goolsarran said that there are too many questions outstanding for NICIL not to be looking into the matter. “Another question is why did NICIL not take appropriate action to sell off its investments that are not yielding a return?”
The Auditor said that it is extremely ironic that NICIL disposed of a highly profitable investment of 20 percent of its shares in the Guyana Telephone and Telegraph Company (GTT), but has retained several other investments for which it has been receiving no return, including investments in the New GPC and Hand-in-Hand Trust.
In 2012, NICIL sold Government’s shares in GT&T for US$30M of which the sum of US$25M was received. The balance of US$5M was to be paid within a period of two years, but that account is yet to be settled.
In the NICIL report, Goolsarran pointed out that during the period 2002-2011, the Government received $5.261B in dividends from the shares, or an average of $526.1M per annum. However, it was stated that government suffered a major loss in the disposal of the shares and that that sale was a blunder.
The Auditor said that by disposing of the shares, “the Government would have lost $1.578B, equivalent to US$7.616M, in revenue during the period 2012-2014.”
Further, it was pointed out that the purchaser of the shares, Datang Telecom Technology and Industry Group would therefore recover the cost of the investment in less than 12 years by way of dividends, while at the same time retaining the investment.
The APNU+AFC government has been complaining that its predecessor—the People’s Progressive Party/ Civic (PPP/C)—left the public purse almost empty. New GPC is a profitable company. During the reign of the PPP/C government, approximately 80 percent of Government contracts for the procurement of drugs used to be handed to New GPC. Accumulated dividends for government’s 10 percent shares in New GPC may run into the billions.

2 thoughts on “NICIL should probe Jagdeo’s sale of lucrative GTT shares”

rs dasai July 5, 2016 at 9:59 am

Do not ask why , demand payment now.
Dennis Mckenzie July 5, 2016 at 11:09 am

Jagdeo is BUMPING his GUMB about everything else,except the transactions he and Bobby his alleged best friend of the New GPC had.I believe,the GRA must investigate this matter thoroughly,not only in order to find out what really took place,but to take the necessary action possible.