NICIL says has not received outstanding US$5M for GTT shares
Government holding company NICIL today said that it had not received the outstanding US$5M for government shares in GT&T.
The statement by NICIL would raise questions about a recent statement by Minister of Natural Resources Raphael Trotman who had said that Minister of State Joseph Harmon had retrieved documents from his trip to China which showed that the money had been paid before last year’s general elections.
The statement by Trotman raised eyebrows and led to calls for a quick verification given the ease with which such money transfers could be traced. Cynics had suggested that through Trotman’s statement, government was trying to deflect the negative spotlight on Harmon as a result of his controversial trip to China, around which many questions are still unanswered.
The NICIL press release follows:
Press Release on the Facts of the Agreement of Share Sale and Purchase of GT&T Shares
The National Industrial and Commercial Investments Limited (NICIL) has decided to issue a press release, in light of the controversy concerning the status of its attempts to secure the payment of the outstanding balance of US$5M, relating to the sale of its 20% shareholding in GT&T.
On the 24th August, 2012, NICIL and Hong Kong Golden Telecom Company Limited (HKGT) executed a Share Sale and Purchase Agreement (SSPA) for the sale of NICIL’s 20% shareholding in GT&T, as approved by the former Cabinet.
The SSPA provided for the Purchase Price of US$30M to be paid as follows: (i) US$25M to be paid on the closing date and (ii) the balance of US$5M to be paid on the completion date, which is defined as the second anniversary of the closing date or such other date as agreed to between the Vendor and the Purchaser.
To clarify conflicting reports regarding the identity of the contractual party to the SSPA: HKGT was the contractual party to the SSPA and is a subsidiary of Datang Telecom International Technology (Hong Kong) Company Limited, which is wholly owned by Datang Telecom International Technology Co., Ltd., PR China. Datang Telecom International Technology Co., Ltd. is listed as a second tier subsidiary in the Datang Group of Companies.
On the 8th November, 2012, US$25M was wired to NICIL’s US$ account held at Republic Bank (Guyana) Limited. The balance of US$5M became due and payable to NICIL on October 22, 2014 and, despite several written requests by NICIL, HKGT has still failed to pay the balance of the Purchase Price.
In an attempt to avoid costly and lengthy adjudication of the matter in the English Courts, NICIL requested the assistance of the Government of Guyana to encourage HKGT through diplomatic channels, to honour its contractual obligations.
Contrary to various media reports, NICIL has not received the outstanding US$5M and HKGT remains in default of the SSPA. To NICIL’s knowledge, neither HKGT nor its related companies have alleged that the balance of US$5M was paid. What was alleged by the Purchaser’s signatory to the agreement was that following a series of communications with the Former Guyana Ambassador to China (to be authenticated) HKGT was assured that they were not required to pay the balance of US$5M, because the HKGT had not been granted the same minority protection rights enjoyed by NICIL (i.e. two, instead of one, representatives on the GT&T Board of Directors) which HKGT alleged were promised to them. HKGT also alleged that the decision to waive the US$5M was contained in a side agreement.
NICIL has not been able to verify the veracity of HKGT’s claim of waiver and has requested the assistance of the Government of Guyana to verify the validity of HKGT’s assertion and the documents they produced to support same.
A further press release will be issued at the end of the verification process.
Maurice Odle (Dr.)
Chairman
Board of Directors, NICIL
