Tuesday February 9th, 2010
- Last update:10 hours 20 min ago
UTC hires receiver for US$1.5b development
Published: 18 Oct 2009
The Unit Trust Corporation last week pulled the plug on a US$1.5 billion development in the Turks & Caicos Islands, placing a five-star resort there into receivership because it had failed to meet payments on a loan from the local financial institution. The UTC placed the Dellis Cay development in the Turks & Caicos islands into receivership on Thursday, about a week after the developer Turks Ltd, stopped construction, according to a report on the Wall Street Journal’s Web site yesterday. The exclusive five-star scheme comprises a 25-room hotel, 78 for-sale condominiums and 17 villas, serviced by a Mandarin Oriental hotel as well as restaurants, golf course, tennis courts, spa, boutiques, cinema, business centre, pools, cigar room and library.
A report in the Turks & Caicos Weekly News yesterday, stated that UTC was owed US$$7.1 million in principal and interest repayment on August 22, but, up to last week, only US$4.1 million had been paid. The developer appealed for emergency funding but the UTC opted instead to take over the property by appointing William Tacon, an accountant in the British Virgin Islands, as the receiver. One of the developers, Dr Cem Kinay, was accused of making a US$500,000 “contribution” to the former ruling party in the Turks & Caicos Islands and Kinay said last week that confidence in his company had been “destroyed” by negative press. The Turks & Caicos newspaper said that the developer had waged a costly legal battle to have adverse references to himself removed from a final report of a Commission of Inquiry set up to examine allegations of corruption.
Kinay was quoted as saying: “We have been struggling with very little cash in hand for the past weeks and have been operating under very difficult trading conditions. “We asked TTUTC to consider providing us emergency funding and an extension of time of 60 days on the unpaid portion of the interest payment that was due on August 22, 2009, whilst we make efforts to regularise our financial position and provide a credible restructuring plan with new equity partners, Mandarin Oriental Group, and the existing purchasers. “These requests are now rejected.” Responding last night, UTC’s executive director Marlon Holder said the decision to appoint a receiver, for all the companies that are included in its security package for a bridging facility extended by its merchant banking arm, was taken to protect its interest. “The security package includes the lands, buildings and infrastructure which are part of an upscale resort development on a private island in the Turks and Caicos aimed at high value individuals,” explained Holder.
He said that the UTC was of the view that the value of the project could be “maximised by attracting new investors and will seek the co-operation of all the existing interested parties, including the original developers, to formulate a package that will attract new investors and purchasers in the development. “The UTC wishes to emphasise that by appointing a receiver it has acted in the interest of the Corporation and its investors whose interest it has treated as paramount for the past 28 years.” Dellis Cay is a 560-acre island and its villas, mansions and spa were designed by internationally renowned architects including Japan’s Shigeru Ban, London’s David Chipperfield and Milan’s Piero Lissoni. Construction started in 2008 with a targeted completion date of late 2010, according to the Wall Street Journal. Britain ordered the suspension of the government and imposed direct rule over the Turks & Caicos in August after the Commission of Inquiry found evidence of widespread corruption.
Cash cow or sacred cow? The
Cash cow or sacred cow?
The UTC must thread carefully with our money. We don't want to see another financial collapse of the magnitude of Mr Duprey's debacle. My math ain't good, but 1.5 billion multiplied by 6.33 converts to a staggering TT$9.495 billion dollars!
The UTC has had a tradition of being a stable local corporation and advertises itself as being sound.
Should local depositors (shareholders) now be concerned about this whole financial debacle, assuming the headline and news story are accurate? Is there any comfort in all this, what appears to be a failed investment and how much can now be salvaged. Is this going to be another CLICO or is it too soon to panic? Why did UTC pump so much money into such risky investments?
My main question, however, who's minding the UTC's store?
ajfyzabadbutlertown
Is Calder Hart in charge of
Is Calder Hart in charge of UTC too?
According to this article,
According to this article, "Britain ordered the suspension of the government and imposed direct rule over the Turks & Caicos in August after the Commission of Inquiry found evidence of widespread corruption."
Maybe we can ask the Queen to help out when she comes for next month's CHOGM?
Meanwhile, the English Press has reported that a small Scotland Yard team (nicknamed "Sunshine Squad") sent to help the local police to investigate corruption in the Cayman Islands are having a ball and living the life of Riley, with the costs for the past 16 months put at £5.3million (pounds) and likely to cost £8million by the end.
Seems corruption is becoming endemic in the Caribbean. Must be something in the air or water. Maybe as the boys in blue are in the area, they can check out Udecott for us? But it won't be cheap.
The Prince - Our
The Prince - Our Representative:-
May we suggest that you be our Liaison Person to meet with the Queen to have a tete-a-tete to get this Inqury going.
R.S.V.P. - utmost urgency, so that I can order your top hat, coatails and brolly so you be properly attired to sit with Her Highness for high tea. (But you may already have yours ready and waiting?)
Thanks for those red roses. Much appreciated. Now I am look like a flower child.
Enjoy your day.
Gardenia
Gardenia, I accept with
Gardenia, I accept with great pleasure and honour. Please make all arrangements asap.
I have some more inspiring words for you from yesterday's Church Service:
"Let nothing upset you, let nothing startle you.
All things pass; God does not change.
Patience wins all it seeks.
Whoever has God lacks nothing:
God alone is enough". (St Teresa of Avila)
The Prince
There's a lot that the UTC
There's a lot that the UTC not letting us know about our investments. I strongly believe that the Govt keeping us in the dark so as to avoid depositors panicking and causing a run. I'm certainly not getting caught with my pants down like I did with Clio.
Question - Check U-Online .
Question - Check U-Online . Any UTC customer can track their investments online with UTC U-online accessible via www.ttutc.com If you have questions about your investments or on their performance you can always call UTC at 625-UNIT or visit any customer service centre.
It is the same old
It is the same old story:T&T too small for the global financial meltdown to affect us. Delis Cay extended its credit risk based on rising real estate prices and UTC was the fall guy. That's two strikes against UTC that I know of:the sugar VSEP package and now this.
Rik Hansel
MDaniel I see that some did
MDaniel
I see that some did not read the article, my points
- The UTC was committed to investment was 7.1 M, USD,(less than 45MTTD_ of which 4.1M USD (less than 26M TTD) no where near the billions of USD quoted.As a UTC investor looking on given the assets of the UTC this does not see unusual.
- All investment involved RISK, there is no such thing as a risk free investment. even govt bond carry inflation risk.
- The UTC must take risks to be able to pay its investors a return, and it must include a variety of risky investment in its portfolio.
- What does the GOV'T have to do with UTC investments risk profile and investment strategy?
- Individuals should read the investment instrument prospectus before committing your funds, you will be surpised the information you will get.
- Investment strategy details have to be private, what would be the point otherwise.
You need to do some research
You need to do some research before you come to the conclusions you have. The UTC moved after an installment could not be paid. They did not put a US$1.5 billion project into receivership over $US7.4. trust me on that!!!
Did the UTC exercise due diligence in funding this project and therefore had an appreciation for the risk involved. These are the issues and questions a responsible press would ask.
The UTC needs to come clean and not leave it to Wade Mark.
The Casual Observer
LOYAL INVESTOR
LOYAL INVESTOR -
I have been a loyal investor in UTC since its inception. I have seen it grow from strength to strength. I no longer have the confidence in the organization that I had when Mr Benn was in charge. I have gradually limited my exposure in this organization and have moved as much as I can out. Party appointments to the board no longer seem to be seeking John public's interest.
MDaniel, I'm neither lawyer
MDaniel, I'm neither lawyer nor financial expert, but I believe I'm entitled to know about goings on in the UTC if I'm an investor of any size, even if I have just one tt dollar invested there.
Respectfully to you sir, even if people didn't read the article properly, and if is only a lil few millions UTC stands to lose, UTC investors and the general public have a right to know and a right to air their concerns.
People are naturally scared about their money after the meltdown of CLICO and the Hindu Credit Union. Moreover, former Caroni workers are claiming that UTC is not dealing fairly with them in respect of some deposits made when Caroni 1975 Ltd wound up. With respect to the HCU and CLICO, it is alleged that many big people have feathered their nests with people's money, some even in offshore banks and Florida investments. But I have not seen any concrete evidence to substantiate these claims.
Whilst I agree that investment carries risk, people have a right to know if the company they are investing their money in is managing their money responsibly all,if not most of the time. I will tell you, sir, I know of many people who lost money from CLICO and HCU, as well as NCB when it merged, as well as those collapsed finance houses in the late 1980s. And it wasn't nice. Some lost their, house, some their wife, and some even their life.
To the best of my knowledge, I don't think UTC is covered by the Deposit Insurance Scheme, in the same way that some accounts in commercial banks are covered. So what protection is there for the average investor? What guarantee does a UTC investor have? What law or regulation gives the UTC investor good chances of recovering his money in the event of a meltdown there? I speculate that our 'insurance' is the tacit support of the government of the day.
Is it any co-incidence that only the Guardian was able to break this story?
Now, I'm all 100% for the welfare and financial vibrant health of the UTC and I wish the oragnization prosperity all the time. But all we're asking is that there be no repeat of CLICO and HCU.
Finally, we expect the spin doctors will be bowling their doosras aplenty now that the Guardian has broken the story.
ajfyzabadbutlertown
THIS IS A $US1.5 BILLION
THIS IS A $US1.5 BILLION PROJECT: Note carefully that the payment was $US7.4 million, and this was an installment. What we need to know is how much did the UTC invest in this project and what was the source of these funds, is it from earnings or debt? What is the impact on returns.
The cost of the project is US$1.5. Hopefully the UTC did not lend anywhere near this to the Developers, but note they are mum on this.
One of the Developers reputation has been questioned. As a depositor I am very concerned of the potential impact on the UTC.
Come on journalists lets ask the hard questions now before the BAILOUT, when no one will be talking.
The Casual Observer