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Don’t liquidate CLF
Chairman of the Clico Policyholders Group (CPG) Peter Permell has described Finance Minister Colm Imbert’s attempt to liquidate CL Financial as an “unfortunate and unnecessary act of desperation.”
He was speaking at a joint press conference with Carlton Reis, of the United Shareholders Limited at One Woodbrook Place, Woodbrook, yesterday.
The groups have joined forces to oppose the planned liquidation of CLF and held an emergency meeting on Thursday, shortly after Imbert stated at a post Cabinet media briefing that Government would not sit by and allow control of CL Financial board and its companies to be taken away.
Permell is claiming that sale the company’s assets, estimated at $40 billion, would benefit party financiers and big businesses.
“It was an unfortunate and unnecessary act of desperation. It is not in the best interest of the policyholders, taxpayers, employees and shareholders of CL Financial and Clico,” he said.
He added that the cost to liquidate would be substantial and would be paid out of the company’s resources since the liquidators privately or publicly sell any of the company’s assets.
“That raises all kinds of questions as the public may not be aware of what is being sold, where it is being sold and at what price it is being sold at,” he said.
Permell said in seeking to repay funds dispersed in the 2009 bailout, the CLF board and shareholders commissioned PriceWaterhouse Coopers to review the financial status of the conglomerate and to come up with a plan.
He insisted that CL Financial has sufficient assets, cash and other investments to settle all outstanding debts and to maintain its current liabilities.
“In order to wind up any entity you first have to be insolvent. CL Financial is solvent. The issue of winding up a solvent company does not arise now. As far as we are concerned this is a scare tactic on the part of the Government to precipitate certain actions on the part of CL Financial shareholders. This is bad news for everybody,” he said.
If the Government were to succeed in court, Permell warned, the liquidation would turn into a fire sale.
“Why is the Government going that route?” he asked, adding that several business owners were “lining up and salivating at the thought of a fire sale” because the assets would be given away.
“We will have none of it,” he said.
Reis said since 2013, shareholders have tried to negotiate with the People’s Partnership government and the current administration to repay the bail out but they were ignored, treated unfairly and oppressed.
“The way we look at it, the Government has converted for the last eight years CL Financial and Clico into a state enterprise. They running their affairs and do what they want inside there,” he said.
Reis said CL Financial and Clico are in a position to repay taxpayers within 120 days. He said Lawrence Duprey, the single largest shareholder of CL Financial, wants to see the company back in shareholders’ hands and is willing to advise the new management team in the background.