Citrus deal faces another hurdle
In news from the Stann Creek Valley, continued controversy in the citrus industry has led to yet another lawsuit, this time against the Citrus Growers Association. Reports from industry sources are that last week attorney Lois Young-Barrow, acting on behalf of citrus farmer Oscar Ramirez, filed for an injunction, asking the Supreme Court to delay its ruling on the restructuring of Citrus Products of Belize Limited. That company is owned by the members of the Citrus Growers Association. We understand tonight that the injunction has been granted, with a new court date for the decision set for October fourth. As we have previously reported, the C.G.A. had asked the Supreme Court to remove the negative retained earnings on C.P.B.L.'s books ... a move that would enable the company to begin to issue dividends on current profits. But allegations against the board of the C.G.A. are that dividends need to be issued as part of a guaranteed rate of return on investment to a group of Caribbean investors who have signed an agreement with the association. In May, the C.G.A. and Blue Waters Limited brokered a deal that would see the purchase of close to forty-seven percent of the shares in C.P.B.L. for twenty-five million Belize dollars. The money has not yet changed hands as the international group is waiting for the Supreme Court ruling. The process began to sour in August when growers learned the details of the agreement and some objected that the deal was too favourable to the investors. At a special general meeting held earlier this month, a five man team was appointed to review the agreement. Their findings are expected to be presented to the C.G.A. membership in October.
Mr. Denzil Jenkins, Member of the Board of Directors of the Citrus Growers Association (CGA) was on Wave Radio last Thursday morning explaining to the nation how certain individuals, supposedly acting on behalf ofthe Board of Directors of the CGA, was secretly planning to sell 47% of Citrus Products of Belize Limited (CPBL), the company that owns the citrus factory, to a group of investors from the Caribbean.
Mr. Jenkins explained that Blue Waters Limited from St. Lucia was going to purchase some 25 million newly issued shares of CPBL at a price of BZ$1.00 each and would have been facilitated with just over 12 million CPBL shares that the CGA currently owns, for a 47% stake in CPBL, and would silently take over control from the Belizean Citrus Growers who presently own 100% of the citrus factory.
The deal was set up so that CPBL would receive all the proceeds from the 25 million new shares and the investment company set up by the CGA to hold the shares (about 98%) in CPBL would “give” 12,023,446 shares to Blue Waters for BZ$4.00. The management and board of CPBL would then have control over the $25.0 million while the Citrus Growers would have lost over 12.0 million of their shares with no say or no share of the proceeds. Overall, Mr. Jenkins described the entire arrangement as being detrimental to the Citrus Growers and questioned the motives and personal interests of the parties pushing the proposed agreement.
A Special General Meeting of the CGA membership was called the morning of Saturday September 16, 2006, in Dangriga Town to protest and put a stop to the proposed agreement. Citrus Growers from throughout the country showed up in the hundreds to voice their dissatisfaction and disgust towards this proposed secret deal.
Dr. Henry Canton, Chief Executive Officer of CPBL, and Blue Waters’ representatives were given the opportunity to speak to the meeting explaining the once secret contract. Both speakers were loudly criticized by the farmers. Later on, Mr. Denzil Jenkins and Mr. Eugene Zabaneh explained to the growers how the sale would adversely affect the livelihood of Belize citrus farmers. Mr. Zabaneh revealed at the meeting that the deal was not actually being signed with Blue Waters but rather an off-shore company (an ICB) out of St. Lucia that was formed February, 2006, with assets valued at only US$1,000 and whose shareholders are yet unknown.
Growers then unanimously voted to immediately cease all further discussions “with Blue Waters” and to place the “sell out” on hold. A committee of 5 Citrus Growers were elected to study and analyze the proposed “sale document”. The committee is to report to the CGA in 30 days with their findings and recommendations at another Special General Meeting. Growers left the meeting with much delight and satisfaction because of being able to halt the “secret sell out” of their citrus factory.