By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
The Prime Minister "aggressively" intervened to prevent Hutchison Whampoa "looting" the Grand Lucayan on the eve of the Government's takeover, Tribune Business was told yesterday.
Michael Scott, chairman of Lucayan Renewal Holdings, the Government-owned special purpose vehicle (SPV) that now controls the resort, confirmed to this newspaper that the Grand Lucayan could have been rendered inoperable by the former owner stripping it of key assets.
Arguing that Hutchison Whampoa's actions represented "a fundamental breach of contract", and could have resulted in a legal battle, Mr Scott said the Government's prompt action - led by Dr Minnis - had "avoided that happening".
He added that himself and other Lucayan Renewal Holdings directors had been "horrified" when tipped-off to what was occurring on the night of September 10th, just hours before the Government - through the SPV - was to assume operational and management control at Freeport's anchor property.
Among the assets involved were golf carts and service vehicles, plus a host of IT-related devices such as laptops, ipads and computer monitors, which Hutchison Whampoa intended to redeploy at its other corporate offices in Freeport.
Mr Scott, responding after Chester Cooper alluded to the dispute during his House of Assembly, confirmed the Opposition's deputy leader was "correct" in what he had said about Hutchison Whampoa's actions.
"What they did was they took the view, some lawyer, that the handover was going to occur at midnight on September 10/morning of September 11," the veteran attorney told Tribune Business. "They were in a hurry to get out on September 11, so we moved to take over management and control.
"The way in which they interpreted the [sales] agreement was they could take out whatever they wanted. In the evening they proceeded to de-camp with the golf carts, the service vehicles that you run linen, towels and dry cleaning around in, certain other service vehicles, ipads, laptops, cell phones and monitors for desktop computers, and relocate them for use in other businesses and offices established in Freeport."
Asked whether Hutchison Whampoa's actions could have potentially crippled the Grand Lucayan's operations on the first day of government control, Mr Scott replied: "How does a golf course function without golf carts? Let's start with that."
The Lucayan Renewal Holdings chairman said himself and another director, Willie Moss, analysed the sales agreement "very carefully" once alerted to what was happening to determine whether it permitted Hutchison Whampoa to remove these assets.
"We were horrified when tipped off about it," he told Tribune Business. "We looked at the agreement, identified the paragraphs which said where they couldn't do that. It was a breach of contract.
"We notified the Attorney General and the Attorney General's Office, they met with the Prime Minister, and he had a conference call with Hong Kong on the morning of September 11. The Prime Minister spoke to Raymond Chow [a senior Hutchison Whampoa executive], said they were dealing with a sovereign state and that their behaviour was unbecoming of negotiations between Hutchison and a sovereign state. He undertook to put the property back, which they did."
Mr Scott continued: "When I got up there on the 12th, I called in and spoke to Graham Torode, who is Hutchison's local representative in Freeport, and formally complained on behalf of the Board and Government of the Bahamas. I got his undertaking that everything taken had been replaced."
The Lucayan Renewal Holdings chairman said the Prime Minister's involvement, and decisive action, had resolved the matter and prevented an already-strained relationship with Hutchison Whampoa from deteriorating further.
"To be very clear about this so there is no question, no ambiguity and no doubt, the Prime Minister was advised by the Board that they were about to loot the property, and he acted immediately and aggressively to avoid that happening and head it off," Mr Scott told Tribune Business.
"It was addressed and resolved very quickly. Had they done it, we would have had to commence legal proceedings for a fundamental breach of contract. It was my responsibility, and I was not going to permit that to happen."
The episode, though, is unlikely to endear Hutchison Whampoa to many Bahamians, especially those on Grand Bahama, given the favourable sales terms it appears to have obtained from the Government.
Besides not sharing the burden, and being relieved of having to pay $3.25m in Stamp Duty on the real estate sale, the Hong Kong-headquartered conglomerate has been allowed to keep the $80-$85m in insurance proceeds received on its Hurricane Matthew claim. This is despite its decision not to invest a cent in repairs estimated at $35m.
Hutchison Whampoa is also receiving $2m from the Government in return for not shutting the 196-room Lighthouse Pointe property down from August 1, in addition to interest at 4 percent on the seven $5m bond tranches that will repay the $35m it is providing in vendor funding to finance the purchase.
Mr Scott, meanwhile, said the formal sales prospectus that will be issued to potential Grand Lucayan buyers remains "in train". He added: "We have to agree on who's going to do the appraisal, who's going to do the marketing. I'm not at liberty to name names."
The attorney also described voluntary separation packages for Grand Lucayan staff as "a work in progress", with all workers receiving their due salary payments in full today.
"We've just had our first payroll since takeover," Mr Scott said. "The best news I can give you is it passed uneventfully, which means everybody got paid. I gave my personal undertaking it would happen, and it's happened."
Comments
Alex_Charles 5 years, 7 months ago
That is certainly not an entity that operates in 'good trust'. But HW has a history of skullduggery and they are a part of the crux by which the PRC got the Bahamas to break ties with Taiwan. If there wasn't an intervention, I wonder how that would have played out...
birdiestrachan 5 years, 7 months ago
Willie Moss did not see to it that they pay the stamp tax of over three million while they pat themselves on the back for saving old equipment. A hotel valued at 57 million before the Hurricane after the hurricane they paid 67 million for a damaged property If the company received 80 0r 85 million from the insurance. The repair bills must be more than 38 or 39 millions. The fellows lie so much, Masterful liars. But the truth will come to the light.
I have no problems with Hutchison taking them to the cleaners. They are to Pompous in their dumbness
DDK 5 years, 7 months ago
Thing is, WE ALL get taken to the cleaners.
Porcupine 5 years, 7 months ago
Exactly. As if, the FNM and the PLP are the one's to lose. WE ALL lose. And big time.
pileit 5 years, 7 months ago
My circuits are shorting...I AGREE with birdie opinion!!
TalRussell 5 years, 7 months ago
Ma Comrades, when you think Lucayan Hotel purchase couldn't possibly get any more Whampoa crazy - just digest this, okay. Hope PM, KP and AG Carl Wishire, had smarts summon Commsh Policeman's to guard the still wrapped and unwrapped rolls shi# paper from being repossessed by Whampoa.
BMW 5 years, 7 months ago
HW and the port gotta go! All port lisecees just gotta stop paying buisness liscense fees. Grand Bahamians are the one getting screwed by these two entities.
BahamaPundit 5 years, 7 months ago
I have no problem with this private company. They have the right to get the best deal. It is our government that stinks worse than anything I have ever smelled before. I have a nose for corruption. The odor is terrible. Minnis has a terible terrible terrible odor.
BahamaPundit 5 years, 7 months ago
This man tricked the Bahamian people like they have never been tricked before. Hell is real. Hell is real.
birdiestrachan 5 years, 7 months ago
These FNM fellows always looking for some one to blame, they can not blame the PLP so they blame Hutchison. But they know that it is their FNM papa who made the Hutchison deal. in the first place. That is what the FNM Government does. MAKE BAD DEALS>
Porcupine 5 years, 7 months ago
This is just the beginning. This will not end well for The Bahamas.
bogart 5 years, 7 months ago
FULLY AGEEE PORCUPINE...... It would be an embarassment .....loss of face ....to major conglomerat..operating ...in several nations internationally.....and of course would immediately return items....they have lawyers advising them. If they wanted a few thousand dollars more all they have to do is possibly threaten to raise the 4% interest on thev35m loan by fracton to get even more if interest variable subject to change days notice The Bahamian gubberminnt and all its lawyers....extensive skills in the Hotel Corporation dating back to like 1974...??....countless Sales Agreements ....selling buying...leasing...renting...?? Hotels....inventory...chattels...contracts....licence agreements...etcetc...making AGreements for Sale.........should not under ....any ....circumstamces ...leave ......any ....or slighest remotest doubts ....in any Agreement for Sale ..........as to ....what was being bought.......sold.........FACT that the other party under the expected ADVISORY of Bahamian lawyers could tink they could... actually...boldly... physically remove the items........used golf carts costing what $2,000. a piece...10.x $2,000. ....second hand.....laptops, cell phones...ipads....monitors...???......$25,000.?.??...like...3 business class plane tickets to Hong kong..?...muddoes dred....!!! Investigations needed and ......LAYWERS DRAFTERS OF AGREEMENT FOR SALE....IF GUILTY...allowing this NEED TO BE DISBARRED.....
TheMadHatter 5 years, 7 months ago
"Had they done it, we would have had to commence legal proceedings for a fundamental breach of contract."
Really? Had i done it, the police would have my a$$ in jail and i would bear the burden of proof (while in jail) to show what right i had to the items.
3 million here, 35 million there, 65 million over there, God know how many million at container port and airport.
Government should give Hutchinson notice to December 31st to get ALL of their stuff out of this country including all Chinese citizens whether employed by them or not. Shut down the container port. Shut down the airport. Shut down the harbour. Shut down all the food and chicken and liquor stores they run in Nassau. We can barge food in from Nassau to feed Freeport people and build a new airport by the old missile base at Gold Rock Creek.
Nationalize all their stuff and close their bank accounts and tell them GET OUT !!!
Also from Dec 31st no person from China, Hong Kong, Taiwan allowed to even visit Bahamas and no goods to be imported originating or passing thru those countries. All telephone and IP communication to be cut off as well.
It will be painful at first - but like a tetanus shot, it will save our lives and the pain don't last forever.
Show the rest of the world how to deal with these jacks.
TheMadHatter 5 years, 7 months ago
Shut down the Hilton. Shut down The Pointe. Everything. Just get the Hell out!!!
bogart 5 years, 7 months ago
...ya hav to feal wid the step before that......an the one before....an before....Challenges go from before that....whichin.....is the need for FDI....as the previous politicians did not diversify the ecomony....whichin goes before that.....wastage of taxes....goes from before that.....nobody punished...lawyers depend on foreign businesses....all these are Bahamian lawyrrs....
BahamaPundit 5 years, 7 months ago
RETheMadHatter Good try but they would nuke us. They own our government. Get used to it.
BahamaPundit 5 years, 7 months ago
China forcing us to join WTO like all the other African nations they've colonized. We are, from Baha Mar onwards, China's colony. We've joined their list of territorial assets to squeeze the US. Pretty soon they will make it so that nothing bad can be said against China in our Press.
Mobile: https://www.thenational.ae/world/asia...">https://www.thenational.ae/world/asia...
https://www.reuters.com/article/angol...">https://www.reuters.com/article/angol...
China gave billions to Djibouti, they were unable to pay back. Now China has confiscated their habour as collateral damage.
-China gave Maldives a loan they were unable to pay. Now 38+ percent of the state owned resorts belong to China
-Madagascar couldn’t pay, lands were used as collateral damages
-Zambia can’t pay their loan china is taking over their airport and airspace next month(military jets included)
-Ethiopia couldn’t pay back the loan , now the rail way system belongs to Chinese
-Kenya, 70% of their mineral resource mines belongs to China, because they couldn’t repay the loan..
Porcupine 5 years, 7 months ago
BahamaPundit, I've read your links. You have a strong case. Now, do we do as Madhatter suggests? Or, is there another route? Given that our government is in a geopolitical chess match with China, is there anyone among us who thinks our guys have a chance in hell of winning? No, zero chance on saving The Bahamas from the future trends where China owns this country. I wish we had a few more people in this country who read something other than facebook.
BahamaPundit 5 years, 7 months ago
Here's what I believe will happen: In about one years time, China will buy a very large portion of Grand Bahama and transform it into a futuristic city, the Signapore of the West. China will invest a billion dollars plus into Freeport. The Government knows about this deal and that is why they are purchasing the hotel. This is also why China is forcing the Bahamas Government to join the WTO. Now, sit back and watch.
BahamaPundit 5 years, 7 months ago
China will move manufacturing to Freeport and 500K plus Chinese will move to Freeport. China will begin using Freeport for manufacturing tech products for the US market.
BahamaPundit 5 years, 7 months ago
FNMs with insider information will start buying up property and housing in Freeport. If you see this start to happen, my "guess" prediction is right. China has just started with the Bahamas. Fasten your seat belts, in ten years this country will be a huge China hub. You ain't seen nothing yet!!!
TalRussell 5 years, 7 months ago
Ma Comrade sweet Jesus, try imagine fighting the 2022 general election campaign whilst trying spin away how the prime minister and KP, after committing PeoplesPublicPurse and PeoplesCreditWorthiness to $134 million buy left un repaired hurricane damaged hotel property - could have became so bogged down in unopened and subject being all shitty smeared opened rolls Toilet paper caper. Not such light-heated caper when it involves $134 million. { Not so easy made up such shitty caper be believable, when you still don't even know rest Hotel's Purchase deal. Now, is it? }
BahamaPundit 5 years, 7 months ago
Re Porcupine Yes. There is something we can do: 1. The most important thing, which China hates, is transparency. We MUST push for the Freedom of Information Act!!! The PRESS must help us! My greatest concern is that once the FNM got into power, everyone, including the Press, stopped pushing for a FOIA. I couldn't believe it. Minnis was given freedom to carry on with the status quo, majority rule corruption. This must end! 2. Zhivargo Laing must be asked, point blank, if China is in any way influencing the WTO process and how -- this question must be asked by our people and our Press. 3. There must be campaign finance reform and transparency -- no foreign power should be allowed to donate to an ellection campaign. Without transparency, China can donate hundreds of millions to campaigns and shift policy. 4. The full Baha Mar deal must be unsealed as Minnis promised.
These 4 things (above) could save our nation from China's grasp. It's worth a try. China loves black nations because their leaders betray their own people. Unless we realize that the main guilty parties of US and European slavery were black tribal leaders that sold their people into slavery, this will not change.
BahamaPundit 5 years, 7 months ago
Article: Black Africans sold own people into slavery! http://edition.cnn.com/WORLD/9510/gha...">http://edition.cnn.com/WORLD/9510/gha...
Porcupine 5 years, 7 months ago
All sociopathic leaders no matter their color have historically sold their own people into slavery of varying degrees. Otherwise, I am in agreement. Lack of transparency destroys even the mere basics of democracy. The loss of sovereignty seems to be a key. We are allowing the taking over of our natural resources via finance. Our BNT seems as guilty as any other entity of selling off our resources to the highest foreign bidder.
BahamaPundit 5 years, 7 months ago
Another thing that could be happening is the FNM Bahamas Government is about to borrow from China about 200 million dollars to rebuild Freeport or the Nassau cruiseship port, or some other crony foolishness, and one of China's multiple conditions for lending the money is that the Bahamas join the WTO to ensure repayment. We need to find out what China and the FNM are up to. That is the real Minnis. That is the real FNM. That is the real plan for our country, not this fake news we get in Parliament and the press every day.
BahamaPundit 5 years, 7 months ago
What we need is Bahamians to become awake to China's deep state move on this country. This needs to be front page of the Press and revealed by investigative journalism. I wouldn't be at all surprised if they are giving millions to FNMs behind the scenes, as well as the National Trust and environmentalists to prevent the US Disney from buying Lighthouse Point etc. I believe China has a 100 page plan for every island in this Commonwealth, as well as our territorial waters.
BahamaPundit 5 years, 7 months ago
The Bahamas National Trust is, recently, making new Parks in The Bahamas. Why? Probably because fishing is being offered by the Bahamas Government as a service industry open to foreigners by the WTO. Just ask Laing. Do you think it was an accident Ingrahm said the Government should buy the GB Port? The China takeover has all been planned and paid for.
BahamaPundit 5 years, 7 months ago
What will happen is the Bahamas will join the WTO (China will push us through) and then all this crazy S_ _ T (and I mean crazy) will start to happen: fishing will open to foreigners etc. Bahamians will rise up and riot. The FNM will use the riot gear China bought the PLP on the Bahamian public and the FNM will say they are forced to open fishing, realestate, law etc., because we joined the WTO. If Bahamians resist, China will enforce its fishing rights in WTO Court. China has likely been pulling the strings in this country for at least 5 years and WTO is just one string.
ThisIsOurs 5 years, 7 months ago
Amateurs. Suck teeth. Isn't this the EXACT same thing that happened at Bahamar? Why weren't they ahead of it? Why didn't they take steps to prevent a "repeat"? Now they want to put out a story of how Dr Minnis' was ahead of the curve ball after the fact.suck teeth again.
ThisIsOurs 5 years, 7 months ago
"Scott continued: "When I got up there on the 12th, I called in and spoke to Graham Torode, who is Hutchison's local representative in Freeport, and formally complained on behalf of the Board and Government of the Bahamas. I got his undertaking that everything taken had been replaced."
My first question is did they even take an ndependent inventory count beforehand and after the theft to know if "everything" was replaced. Suck teeth
BahamasForBahamians 5 years, 7 months ago
Why is Scott trying to make Minnis seem like the hero in this matter?
Scott and Minnis are the reasons we are in a position for the Chinese to loot an asset we should've taken over!
BahamasForBahamians 5 years, 7 months ago
we should've never taken over*
sealice 5 years, 7 months ago
these people are flat out theives - why do we let them operate in our country?
BONEFISH 5 years, 7 months ago
Hutchison Whampoa are not thieves.They are simply hard and ruthless business people.Let get this straight,that firm did not come to the Bahamas because they love bahamians.They came to make money.They lost quite a bit of money with the Our Lucaya hotel properties.They are deterome of their losses.mined to recoup s
BONEFISH 5 years, 7 months ago
I meant to say they are determined to recoup their losses. I had dealings with business people with that same mentality.
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