Yesterday, the Prime Minister announced Government’s intervention plan to save the citrus industry of Belize. It amounts to a 15 million dollar bailout for Citrus Products of Belize Limited – with its bank First Caribbean International.
The bank will provide 2 million dollars in working capital funds to CPBL and then the government will buy out the US$6.5 m loan CPBL has with that bank.
It has been an ugly battle between CGA and Belize Citrus Mutual, but yesterday seemed to be a turning point. However, absent from that press conference was Bank’s Holdings, a company which owns about 47% of the company’s shares.
Today, CEO of Bank’s Holdings, Mr. Anthony King, met with Deputy Prime Minister and Minister of Agriculture Hon. Gaspar Vega.
“We had a meeting to get a resolution to move forward and I think we have achieved that. I think everyone is quite content that we have found a way forward; certainly Bank’s Holdings is. At the meeting, we had to engage in discussions regarding working capital support and financing for the company. So, the time we spent in the meeting wasn’t all of only the CJ and ourselves; it was also about the company, and I think that we appeared to have a satisfactory resolved the entry in financing as well”.
As minority shareholder, Banks Holdings still had veto power over the board’s decisions and has been accused of using that power to stall the CGA. King responded to those accusations.
Mr. Anthony King: “I don’t believe we have ever used that certainly for the impediment of the company or the in difficulty interest of the company. We have had disagreement in a couple of issues, but under the new arrangements, there is another board, and I think that the arrangements we have agreed upon on the structure of the Board is very likely to not present that as a problem or a need to use going forward”.
With the new Government buy in, there will be three new Directors, one from Heritage Bank, another from Social Security and one from Government.
This places government in a very powerful position to hopefully force the shareholders out of any future deadlocks. Deputy Prime Mister Gaspar Vega told us more about the bailout.
“I believe that with the beginning of prosperity in that industry, we had to come up with $4m on secured loans for CPBL, so that the small farmers can be paid for their fruits that is being owed presently. FCIB agreed on their selling out of their debt at a discount price and that should be taken care of to finalize, we are expecting, within four weeks. Sincerely, everything went well today”.
Reporter: “While it is known that the CGA already owes SSB for two loans as was explained by Mr. Singh, is that a concern for the government?
Hon. Gaspar Vega: “Of course. If it is public funds, it is always a concern for the government, but at the same time, we have to think about the people that would be affected if this industry would collapse. We have to weigh our differences and that is one of the reasons why we wouldn’t contemplate the buyout of the BHL with Social Security funds”.
While business should be improving in the citrus industry, the court suits between CGA and Bank Holdings have been placed on suspension, says Minister Vega.
Hon. Gaspar Vega: “No, they did not agree to drop the suits; they agreed on a suspension of the suits and hopefully they will be able to iron out their differences, settle or just drop the cases. For now, it was just suspended”.