Govt. sacrifices shares in GT&T for Marriott, risks losing all

Oct 30, 2013 News

– Chris Ram

“The country’s money cannot be placed at the disposal of any single individual or handful of individuals as in the case of NICIL (National Industrial and Commercial Investments Limited) and outside the Constitutional and Parliamentary framework.”
This is the view held by Financial Analyst, Christopher Ram, who on his website chrisram.net said that the lessons learnt from projects such as the Skeldon Sugar Factory, the Berbice River Bridge, the Marriott Hotel and the Amaila Falls Hydro Electric Project should be heeded.

Ram posits that large scale projects being pursued by the administration must be properly considered and evaluated by independent persons before they are undertaken.
“GuySuCo should have taught us that we can ill-afford the consequences of poorly conceived and badly executed projects…We have a parliamentary body to oversee economic activities and projects…We should make full use of it.”
Ram in his writings said that the Marriott Hotel project “is the combination of everything that was and is wrong with the other projects.”
On that project, NICIL had set up a one-director company (Atlantic Hotel Inc.) to build a hotel with a secret private partner. NICIL sold its 20 per cent stake in GT&T “from which it has earned billions of dollars in investments and gave it to AHI which used it to make payments on a lopsided contract with another Chinese contractor.”
According to Ram, despite huge upfront investments by the Government “the original private partner vanished, another mirage, another phantom.”
He said that AHI, whose sole director is Winston Brassington, who also heads up NICIL, then sought to canvass the world for another private investor and according to NICIL, “found one who has demanded control of the company.”
Ram said that having invested some US$19M in actual cash and several more in various rights and concessions, “the investor appears to be calling all the shots, dictating how the US$19M is to be treated.”

Bharrat Jagdeo

Ram stated further that NICIL/AHI agreed that the US$8M to be invested by the unnamed private investor will be designated preferred equity while NICIL’s US$4M is designated “non-preferred” equity qualifying for a return “only if cash permits”.
“Worse, the possible return is not cumulative so that if there is no cash for nine years but a huge windfall in the tenth year, the Government receives a one year return only.”
According to Ram, the equity apportionment in the Marriott Hotel is fraught with dangers since two-thirds is all that is required for a special resolution to be passed, allowing those shareholders to do almost anything in the company.
“Again, that is how Amaila was being structured.”
As it relates to the remaining US$15M interest-free loan repayable when cash flows enable, Ram called this “lower than junk bonds status…Yet Winston Brassington has the gall to tell taxpayers that the money would have received next to nothing from the commercial banks… He thinks our memories are so short that we would forget that the money that has funded the project came from one of the most profitable equity holdings the country has had.”