The Belize Telemedia Limited (BTL) tonight held its first annual general meeting since the government took over the company by acquisition order in August 2009. An estimated 100 shareholders of over 900 attended the meeting, along with BTL staff and guests.
The government-appointed directors had decided to declare a dividend of 19 cents per share, and when they put the resolution to the floor, it was carried by a vote of 55-0, with the government representative, Financial Secretary Joe Waight, proposing the resolution from the floor.
Nine hundred small shareholders, who own about 5.5% of Telemedia, will share among themselves $494,000, said BTL chairman, Nestor “Net” Vasquez. The remainder, roughly $8 million, goes to the Government of Belize.
The government took over 94.5% of the shares in August 2009, expropriating them from a group of companies it said were owned and controlled by British billionaire, Michael Ashcroft.
Ashcroft’s attorneys reportedly tried to get a court injunction to stop the meeting, but to no avail.
BTL director Anwar Barrow told Amandala earlier today (when we asked him about the claims the former shareholders may have to dividend payments) that such claims would have to be dealt with in their overall claims for compensation from the government.
Indications from the parties are that compensation claims that the Ashcroft companies will make against GOB could range from $300 to $600 million, plus interest. Government contends, however, that the value estimate from previous owners has been grossly exaggerated.
Shareholders at the AGM were asked to vote on a number of resolutions, the first being the acceptance of the financials, with the exception of a $45 million loan that BTL had gotten with the Belize Bank of Turks and Caicos for the purchase of shares in the company. The board had ruled last year, after the re-nationalization, that the transaction was illegal. The dispute later became the subject of litigation, which has still not been resolved.
They also voted to formally elect the government-appointed board, comprised of Audrey Wallace (Chief Executive Officer to Prime Minister and Minister of Finance, Dean Barrow); advisors to the Ministry of Finance – Dr. Manuel Esquivel, Dr. Carla Barnett, and Mr. Alan Slusher; Colonel George Lovell (ret’d), Chief Executive Officer in the Ministry of Public Utilities and National Emergency Management; Lois Young, SC, secretary to the board; Anwar Barrow, director and son of the Prime Minister and Young; director Ambrose Tillett; and chairman Nestor “Net” Vasquez.
Under the government-appointed board, BTL embarked on a scheme to reclaim customers that had been lost to its competitor (SMART).
“Our figures show that we have captured at least 20% of our competitor’s market share,” Vasquez said in his statement to the floor.
Shareholder Oscar Ramirez, an accountant of Dangriga, questioned the note by the auditor, Pannell Kerr Forster (PKF), regarding the purchase of Great Belize Productions (owner of Channel 5) and its new location on Coney Drive, Belize City – both purchases that the company claims were done with BTL’s funds.
Ramirez asked if there was physical evidence that these transactions were done, and he asked the board whether it would pursue legal action as a result.
Vasquez told him that the board had given a lot of thought to the issue and intends to bring a court claim against the former shareholders for those transactions.
Ramirez also questioned whether the company had any documents to prove that the shares the former owners claimed were being held in trust for BTL workers, were indeed held by an employee’s trust.
At the last AGM, said Ramirez, the then directors had said that about 20% was being held in trust for workers and that another trust, which the directors had claimed was not owned by Ashcroft, owned about 70%.
Vasquez said that when Prime Minister Barrow spoke on the re-nationalization of the company, he expressed the hope that employees would soon truly own those shares which had been held by Sunshine Holdings, one of the Ashcroft companies that the government took control of at the acquisition.
“Are you saying that in the future you will ensure that those shares go to employees?” questioned the president of the Belize Communications Workers Union, Mark Gladden.
“If there is anything I can do to encourage that idea, I will certainly do so,” Vasquez pledged.
The shareholders were next asked to vote on the dividends of 19 cents per share for shareholders on record as of February 19, 2010. According to Vasquez, 45% of the $19.855 million in profits was being paid out in dividends, while the remainder was being retained for “capital expenditure and growth.”
Vasquez said that BTL will be making a range of applications available to customers with fourth generation technology, which would include a range of applications, such as those to monitor one’s heartbeat, to schedule travel plans, and even to play games with people halfway around the world.
Shareholders and directors expressed difficulty trying to wrap their minds around some of the convoluted financial transactions on BTL’s books, such as the creation of an offshore vehicle, Belize Social Development Company in the British Virgin Islands, which was supposed to receive the $38.5 million arbitration award that BTL had been granted by the London Court of International Arbitration against the government—a transaction that the directors say have no value, since the government has not paid, on the strength of an injunction of the Belize Supreme Court.
Attorney/board secretary Lois Young said that in effect, what was created was an offshore shell company with no assets and no workers. It is a matter that the government and BTL will deal with.
Another male shareholder, who wishes to remain unnamed, questioned whether there had to be a quorum for the meeting.
To this, Vasquez said that since the government has 94% of the shares, even if only two people were there, one of them being the government representative, Joe Waight, they would still have the power to pass the resolutions.
Some shareholders, on hearing this, murmured comments that expressed sentiments of powerlessness, thinking that “the more things change, the more they stay the same.”
Vasquez told the shareholders present that the government does intend to divest its shareholders this year, and it would provide Belizeans, and even those existing shareholders, the “golden opportunity” to acquire at least some of the BTL shares from government’s existing holdings.
After that, the directors said, shareholders will also be able to replace some the directors that will come up for rotation.
We note that while there were some shareholders displeased that they, at the end of the day, did not have the power to overturn any of the resolutions tabled at Thursday night’s AGM, there were those who noted that they had greater freedom to address the head table.
There were some resolutions that were carried with no objections, though there was notable number of abstentions.
BTL shareholders agreed to reappoint PKF as their auditors for the next financial year.
The only dissenting shareholder, who did not identify himself, said that he had voted no because the auditors could not resolve the issues raised with regards to the Great Belize Production transactions: the purchase of the shares and the purchase of the Coney Drive building.
At the AGM, Vasquez also commended BTL staff for their passion and commitment to the company.