The Social Security Board (SSB) is considering a $15-million loan for Nature Fresh Belize Limited which would enable the newly formed company to seal the buyout of the assets of Fresh Catch Belize Limited, which was put under receivership last year by First Caribbean International Bank.
Fresh Catch Belize Limited is owned by the Mena family—so is Nature Fresh Belize Limited, according to chairman of the Social Security Board’s investment committee, Nestor “Net” Vasquez.
“The new company is from the same family... As far as I am aware, the shareholders are members of the Mena family,” said Vasquez.
Speaking with Amandala Thursday night, Mr. Vasquez said his committee made a recommendation to the SSB’s board of directors to approve the loan back in May.
Amandala has learned that Nature Fresh Belize Limited was officially formed on the 19th of May 2011.
According to a notice published in The Star newspaper of Cayo, the SSB is offering $14,912,339 to Nature Fresh Belize Limited for 10 years at a rate of 8% on the reducing balance.
Asked how he would respond to criticisms the public might have of SSB’s decision to lend money to a company to buy out the assets of a venture, from essentially the same set of investors, that had been put under receivership last year, Vasquez said that the Mena family has produced more equity than they had in Fresh Catch before, and they have more than 100% collateral.
We asked, what is the collateral? Apart from lands, Vasquez said he was unable to specifically recall anything else when we spoke with him tonight.
According to Vasquez, the Menas now have a much smaller indebtedness to cope with and because of their plans for value-added services, including packaging services to small fish farmers, the production prospects look good.
He told Amandala that the investment committee made the recommendation after doing its due diligence. He said the SSB had enough financial information to evaluate the loan application.
Amandala also contacted Emile Mena, who is also a member of the SSB’s investment committee, for comment, but he declined to give us any specifics.
He did indicate to our newspaper, however, that he couldn’t vote on this loan transaction because of his relationship with Fresh Catch. Mena declined any comment on Nature Fresh Belize Limited, when we asked him about the company.
Documents filed at the Belize Companies Registry reveal that the listed subscribers are Tracey Ebanks and Lisa Peyrefitte, and Nature Fresh Belize Limited was formed by a company called Apex Trust, an affiliate of the W.H. Courtenay law firm.
Vasquez said Fresh Catch, before it went bankrupt, had initially asked the SSB for $6 million.
The only loan records we could find online for SSB in relation to Fresh Catch is a $3.3 million loan listed in the 2005 annual report at 12% interest for a one-year term.
Vasquez said that Nature Fresh can do a lot more with the $15 million than the original plan had envisioned.
The Menas – Joe, Emile, Joseph and Bryan – had informed workers on July 23, 2010, that Fresh Catch had been experiencing financial challenges for quite some time. The company was on the hook for a US$10.6 million loan with First Caribbean International Bank, which also foreclosed on a second business, The Wood Depot, which had been a guarantor for the debt of Fresh Catch.
Vasquez told Amandala, “...we believe that the company will be able to have the earnings necessary to repay the [SSB] loan. We are dead certain they have more than enough collateral.”
He also said, “The banks no longer want our [SSB’s] money.”
According to Vasquez, the average interest rate paid now on bank deposits is around 7%, when SSB used to get 10%.
“Two banks have written to say 5.5% is what they will give,” he added.
He said that the reasons for investing in Nature Fresh are not only would SSB recover its money, but also, the venture would earn foreign exchange, employ workers and have positive spin-off effects for small farmers, who could sell their fish to the new enterprise for packaging and export.
In the published notice coming from SSB’s CEO Merlene Bailey-Martinez this week, the SSB says, “Members of the public wishing to express any concern may send a copy of this notice along with comments to: Chief Executive Officer; Social Security Board; P.O. Box 18; Belmopan, Cayo District; Belize.”
Vasquez said that the publication of the notice is required by law.