GuySuCo says future at risk because of SPU

As the public battle between the State’s sugar corporation GuySuCo and the State’s investment arm NICIL continue, GuySuCo now says its future is at risk because of slothfulness on the part of NICIL and less than credible divestment of sugar assets.

It is the strongest statement yet from GuySuCo after NICIL and its Special Purpose Unit (SPU) claimed that GuySuCo has not been properly accounting for funds it is being given and has been slow in providing details on the assets of closed sugar estates so an investment plan could be worked out to dispose of them.

GuySuCo, in a statement, took issue with the international financial firm PricewaterhouseCoopers (PwC), saying it was recruited as the consulting firm by the SPU to conduct the valuation of GuySuCo’s estates – Skeldon, Rose Hall, East Demerara (Enmore) and Wales.

“Mr. Wilfred Bhagaloo was legally contracted as the ‘lead’ Consultant; as such, it is outside of the remit for Mr. Bhagaloo or PricewaterhouseCoopers to be discussing the Corporation’s business in public, more so in the media, without its permission,” GUySuCo stated.

Mr Bhagalooo had told the media that divestment of the Skeldon and Enmore factories has not progressed because of the lack of information from GuySuCo.

“Mr. Bhagaloo and PricewaterhouseCoopers were selected to conduct the valuation based on what was perceived to be the distinguished reputation; relative to professionalism and integrity with which they would have been expected to treat with information to which they have become privy, by their privileged position with companies and organisations,” GuSuCo stated.

It added: “It is alarming, that a reputable firm such as PWC would allow its name to be discredited, judging from its extraordinary enthusiasm to participate in activities along with NICIL-SPU, even though PwC is aware that the core of its business is hinged on its professionalism and the integrity with which it conducts its business.”

The Corporation accused Mr Bhagaloo of placing his personal relationships above the professionalism of PWC, as well as to participate in acts which are injurious to GuySuCo and its business.

The Corporation then made charges against Mr. Colvin Heath-London, the head of NICIL/SPU, saying Heath-London and Baghaloo knew each other very well in Jamaica, prior to PwC’s engagement by the SPU.

GuySuCo said it views Mr Baghaloo’s statement “as a gross breach of confidentiality and the standards of ethical conduct of the financial and investment industries by the Consultant PWC and which might incur serious consequences.”

On the point of NICIL’s professional connection to GuySuCo, the Corporation said the confusion which started with the Special Purpose Unit (SPU), which it said has now consumed NICIL, as to its role.

“NICIL established the SPU to divest the assets of Skeldon, Rose Hall, East Demerara (Enmore) and Wales estates, however, at some point, NICIL indecorously assumed the role of the Ministry of Agriculture, the Government agency with responsibility for GuySuCo; further, in an attempt to legitimise this position, NICIL had even speciously appointed its own Board of Directors in March of 2018, with Mr. Colvin Heath-London as its Chairman.

“This decision was quashed by the Government, however, NICIL has never abandoned the misconception that, GuySuCo, an independent corporate agency, by Law, according to the Company’s Act, is neither a department, unit or owned by NICIL. Nonetheless, the pre-occupation with this false perception continues to influence the behaviour of NICIL in its dealing with GuySuCo,” the Corporation stated.

With regard to the G$30B bond, GuySuCo argued that NICIL/SPU’s single role was to divest GuySuCo’s assets from the Skeldon, Rose Hall, East Demerara (Enmore) and Wales estate.

“However, due to its slothfulness and less than credible ‘divestment’ tactics it has now placed at risk the retooling and restructuring of GuySuCo as it is clearly outlined in the Government of Guyana (GOG) State Paper on the Future of the Sugar Industry.

“NICIL-SPU, having been unable to divest the assets in a timely manner, convinced its principals that the Bond was an appropriate alternative as an interim financial arrangement; the divestment process is now approaching its second year and NICIL/SPU has not executed one significant investment,” GuySuCo stated.

GuySUCo added that the SPU now operates as a proprietor and landlord and this is totally inconsistent with its intended purposes.

“The Guyana Sugar Corporation Inc. wishes to state clearly that NICIL/SPU are mere custodians of the Skeldon, Rose Hall, Enmore and Wales assets of GuySuCo for the specific purpose of facilitating divestments as envisaged in the State Paper on the Future of the Sugar Industry, the proceeds of which must be remitted to GuySuCo in order to fund its Strategic Plan, NICIL/SPU ought not to be the beneficiaries of the proceeds as currently obtains,” GuySuCo stated.

Additionally, GuySuCo said it is still awaiting a full report from NICIL-SPU on all and any transaction(s) which were completed or are in progress in relation to its immovable and moveable assets, including the scrap metals, machinery, plant and equipment. GuySuCo would also like to be informed by NICIL of the extent of the valuation done by PWC.

With regard to the G$7 billion which NICIL claims is not being accounted for, the Corporation said NICIL is well aware that GuySuCo has several layers to ensure financial accountability.

It listed these as: the procurement process by use of a credible tender process and annual financial statements among others. NICIL/SPU is once again invited to review the company’s financial records within the legal requirements.

The Corporation acknowledged that it indeed requested duty-free concessions to purchase appropriate vehicles to conduct its business but said no SUV’s or luxury vehicles as reported in the press were requested.

The Corporation said the vehicles include double and single cab pickups for agricultural/farming use (to be used in the backdam/cultivations) but that these were not bought using funds from the bond.

GuySuCo denied non-cooperation in providing the information requested and presented the list below showing the information which was provided by GuySuCo to representatives of NICIL-SPU, along with dates and names of recipients.

Record of Information Sent to NICIL-SPU on Vested Estates

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