That was how Minister of Finance Chris Sinckler described an alarm raised by Barbados Labour Party (BLP) spokesman Dale Marshall this evening that Cabinet was set to go through with the sale of the Hilton Barbados Resort before the end of this week, without the approval of the shareholders.
Sinckler told Barbados TODAY Marshall’s concern was nothing but garbage, while explaining that there was a step-by-step process that had to be followed in order to sell the property.
“That is absolute rubbish. It can’t be done until there is a shareholders meeting and a recommendation is made to Cabinet. It can’t be done. The shareholders have to meet and then make a recommendation to Cabinet,” Sinckler stressed, going on to state that Cabinet would meet briefly tomorrow, but there were absolutely no plans to deal with the Hilton sale.
It was at a news conference at the BLP headquarters in Roebuck Street, The City this afternoon that Marshall told reporters he was reliably informed that the matter would come up for discussion at tomorrow’s Cabinet meeting, the last by the current Freundel Stuart administration before the May 24 general election, and he feared the sale would get the go-ahead.
Marshall explained that while the Companies Act required that a company intending to dispose of its assets must first obtain approval from its shareholders, there was no law that required the approval to be sought before the agreement for sale is reached.
It was on this premise that the former attorney general raised concerns that the Stuart Cabinet could approve the proposed deal before getting the shareholders’ approval.
Needham’s Point Holdings Ltd (NPHL), the owner of the Hilton Barbados Resort, is established under the Companies Act of Barbados, with Government being the largest shareholder.
The National Insurance Board (NIB) and the Caribbean Development Bank are minority shareholders.
Marshall’s concern came a day after a meeting scheduled for Monday to approve the proposed sale of the resort was abruptly called off.
“The Barbados Labour Party has been made aware that the Cabinet of Barbados is to be moved tomorrow by way of Cabinet papers, to agree to the sale of the Hilton Hotel by Needham’s Point Ltd. This notwithstanding that the meeting of the shareholders which was scheduled for Monday, May 21 has now been cancelled,” he told the news conference.
“The essential point is that the agreement, once made between the parties can be enforced, even though at the time it was signed, the shareholders had not as yet met. It is enforceable even though the shareholders might not so approve, unless a court later decides to set aside the agreement under the oppression provisions of the Companies Act. In other words, the fight against the sale of the Hilton Hotel is not yet over so long as this Government remains in office and remains resolute to its sale at this gross undervalue,” he stressed, while charging that Government was proceeding “with indecent haste to commit the country to a sale of this asset” at US$80 million, far less than what it is worth.
However, Sinckler said the sale could not take place as easily as Marshall suggested.
He explained that while Cabinet would agree as a matter of policy to sell the property, it was NPHL that was responsible for negotiating its sale.
“Needham’s take charge of the process, they negotiate with the [buyers], they settle on a price, which they inform Cabinet of the price, Cabinet says, ‘fair enough, that seems reasonable, go to the next step’. The next step is the shareholders meeting. That meeting, which was scheduled for May 21, then would be held, that decision is taken ‘yea’ or ‘nay’ and they come back to Cabinet and say, ‘at the meeting of so and so Y resolution was passed approving the sale of the Hilton for the following price under the following condition’, then Cabinet would note [and pass the resolution]. Until that meeting happens, the shareholders meeting, the Hilton cannot be sold,” Sinckler explained.
One media house reported earlier this week that the NIB was seeking to stop the shareholders’ meeting in order to avoid a showdown between the insurance scheme and NPHL.
Meanwhile, addressing a BLP meeting at Wellington Street, The City last night, party leader Mia Mottley contended that Government was forced to back down after she revealed details of the pending meeting at a rally in Oistins, Christ Church on Sunday night, at which she said the sale must be stopped “at all cost”, and called on supporters to turn up in their numbers, if needed, to prevent Monday’s meeting from taking place.
However, Sinckler told Barbados TODAY the decision to call off the shareholders’ meeting was taken several weeks ago because of the “political environment” that developed after the announcement of the general election.
“Once the elections were called a decision was taken to call off that [shareholders meeting],” Sinckler said.
At Sunday’s meeting in Oistins, Mottley produced a document which she said was a copy of a memorandum from the NPHL giving notice to shareholders of a meeting at 10 a.m. on Monday, May 21 at Lloyd Erskine Sandiford Centre to “consider a shareholders’ resolution” on the sale of the hotel.
The document, purportedly signed by NPHL Corporate Secretary Henderson Williams, is dated April 30, 2018, four days after Stuart called the election.