C M Y K C M Y K WEATHER TINGS TOUGH McDOUBLE FOR $3.79 ANY TIME...ANY PLACE, WE’RE #1 HIGH 79F The Tribune LOW 63F BAHAMAS EDITION SUNNY AND www.tribune242.com BREEZY Knowles and C M C M Y K Y K Bhupathi lose THE TRIBUNE S FRIDAY, NOVEMBER 27, 2009 T Volume: 106 No.6 FRIDAY, NOVEMBERSECTION B • [email protected] 27, 2009 PRICE – 75¢ (Abaco and Grand Bahama $1.25) CARS FOR SALE, R Shareholder battle at Colina General By NEIL HARTNELL Tribune B to nemesis usiness Editor * Majority investor: It was a fair offer ‘by any stretch of the imagination’ shareholder dispute has * Minority investor: I’m being squeezed out O erupted at Colina Gen- eral Insurance Agency, with a 25 per cent Bahamas First chief and ex-Colina principal in A. F. Holdings, the Holdings itself, and Colina General, He is also demanding that the miAnorit y inv estor alleging the com- General president and chief execu- majority owner of Colina General, which have been filed with the court order Colina General to pro- pany’s ma jority shareholder is tive, has taken his “shareholder told Mr Walker that their proposed Supreme Court by their attorneys, vide audited financial statements for attempting to “squeeze me out” and oppression” complaint to the offers would see him earn a return Alexiou, Knowles & Co, show they its 2007 and 2008 fiscal years, and undervaluing his stake, and the latter Supreme Court, filing a summons in on investment of between 136.8 per all intend to defend the matter and that Colina General distribute “at countering P that its offers represent- which he is urging the court to order cent and 771.2 per cent, depending that they deny Mr Walker’s claims. least 60 per cent of its net profits” for ed more than ‘fair value’ “by any that a “fair value” for his shares be on the calculation method used. In his summons, Mr Walker is ask- those years. stretch of th e imagination”. determined. Notices of appearance on behalf ing for a Supreme Court order Letters exchanged between Mr Tribune Business can reveal that Yet in letters filed with the of Mr Alexiou, fellow A. F. Holdings requiring A. F. Holdings to purchase Anthony Walker, the former Supreme Court, Emanuel Alexiou, a principal Anthony Ferguson, A. F. his minority stake at “fair value”. SEE page 11B E BISX chief ‘uneasy’ Contractor’s ‘implausible’ defence over $6m overdraft HELP WANTED S on regulator’s bank By NEIL HARTNELL age his affairs”, Appeal Jus- throughout the Bahamas”, of Then, on November 14, Tribune Business Editor tice Hartman Longley noted which Cotton Bay was the 2006, Sharon Wilson & Com- D dividend proposals that this evidence did not largest. pany threatened to “terminate WELL-known contractor come from him, but his two His two children then con- the Cotton Bay contracts” if Edward Penn’s defence to children, who had signed tacted FirstCaribbean to Mr Penn did not attend a FirstCaribbean International I Shareholder By NEIL HARTNELL cheques worth $250,000 on advise the bank of their meeting on November 17. His Bank (Bahamas) demand that Tribune Business Editor the account to keep his con- father’s illness and seek its company’s representatives he pay a $6 million overdraft struction business going. permission to run his account promised they would attend. has been rejected as “implau- A THE Bahamas Internation- nd, while Mr Penn had to meet his business’s finan- “The primary concern of sible” by the Court of Appeal, al Securities Exchange’s denied authorising the pay- cial obligations. Permission the owners appears to have since it argued that his multi- (BISX) chief executive yes- ments made by his children, for this was ultimately grant- been that [Mr Penn] was not SEE PAGE FIFTEEN million dollar construction terday said he was “uneasy” one of those cheques had ed, and from August 2006 to paying his employees and sub- business’s daily expenses were been signed by himself, the January 2007, the children contractors,” Justice Longley S S about the Central Bank’s pro- paid from his per posals that it approve all divi- sonal court said. Some payments signed $250,000 in cheques on wrote. account without dend payments made by his knowl- were also made to settle a Mr Penn’s account. The dispute was settled in edge. Bahamas-based banks, adding $400,000 obligation to Bank Justice Longley noted that December 2006 by Mr Penn While n that it had “raised red flags” oting that Mr Penn of the Bahamas International. it was never disputed that agreeing to hire a project had be by seemingly taking regula- en taken ill for four Justice Longley said Mr those cheques were to cover management consultant to tion into the Board room. months from August 2006 and Penn did not provide evidence Mr Penn’s liabilities, no evi- oversee the Cotton Bay pro- Keith Davies said that while was “allegedly unable to man- of when he recovered from dence was produced to say ject, in the shape of Bahamas- S he planned to conduct more his illness, and suggested that when he recovered from his based Veritas Consulting, and research and analysis on the “he seems to have recovered illness or what this was, and a contract was agreed on N Central Bank’s proposal to KEITH DAVIES upon receipt of the threat to that he did not mention the December 14. The latter sub- approve the payments of bank terminate” his construction illness in his defence and mitted invoices for the Cot- dividends, through getting the Board room of publicly contracts with the multi-mil- counterclaim, “even though ton Bay project to Mr Penn, licensees to justify their deci- traded companies, particular- lion dollar Cotton Bay pro- he denies authorising the who was required to pay them I sions in this respect, he told ly when those companies are ject in Eleuthera. The projec- cheques signed by his children upon receipt from the First- AND REAL ESTATE t’s head developer is Bahami- during the period of the ill- Caribbean account. E Tribune Business it was not owned, operated and con- “potentially troubling” from trolled by the Government, an businessman Franklyn Wil- ness they alleged”. Ultimately, Mr Penn’s First- a capital markets perspective. son. The troubles really began Caribbean account went into battle at “I b Recording the history of the when the law firm, Sharon a $6 million o ecome uneasy when a $4.2608 verdraft as a regulator begins to move into SEE page 11B dispute between Mr Penn and Wilson & Company, wrote to result of the payments made $4. the bank, Justice Longley Mr Penn on November 3, by his children and for the found that the contractor 2006, on behalf of Cotton Bay, Veritas invoices, leading the operated a current account in “complaining about his lack bank to issue a writ demand- his name and various trade of performance on the job site ing payment of that amount. N $4.13 Port’s licensee outreach 51 names, all of which were sim- and pointing out that his Mr Penn’s defence was that $4. ilar to his Penn’s Construction employees were complaining he did not authorise those move is interrupted and Renovations Company about not being paid”. payments, but Justice Long- business. He beneficially David Lockyer, of Penn’s ley said the evidence showed I $4.25 69 owned the business 100 per Renovation and Construction, that “having regard to the B y NEIL HARTNELL cent. responded four days later, commercial realities of the Tribu $4. ne Business Editor When taken ill in August arguing that subcontractors construction industry, if [Mr The information contained is from a third 2006, Mr Penn was “person- were not part of their staff and Penn] intended to comply SIR JACK Hayward was forced to party and The Tribune can not be held hold a meeting with responsible for errors and/or omission ally involved in several large seeking more specifics about Grand Bahama Port Authority (GBPA) licensees at his Fortune from the daily report. construction contracts the complaint. SEE page 4B Cay home on Tuesday night, Tribune Business can reveal, after he refused to tolerate the presence of the “uninvited” Fred S Smith, the Bahamian attorney for the late Edward St George’s estate. This newspaper was informed by sources who attended the meeting, which was initially scheduled to be held at the GBPA’s Freeport headquarters, that Sir Jack asked Mr Smith to leave before it was due to start. In response, Mr Smith is understood to have asserted that he ncial Strength Ra BAHAMAS BIGGEST was both a GBPA licensee and attorney for the St George Fina ting U A estate, and therefore had every right to attend, especially since M BEST the meeting was being held at the offices of a company in A- Excellent which his clients were claiming a 50 per cent ownership stake. Colina General Tribune Business was told that the meeting then fell into an argument between Sir Jack and Mr Smith, with the former eventually telling all licensees present to come to his Fortune Cay home for the meeting, where the Callenders & Co QC and partner would not be present. B This newspaper was informed that a second meeting was also held with GBPA licensees on Wednesday night at Sir Jack’s Fortune Cay home. Among those present were Hannes Babak, GBPA and Port Group Ltd chairman; Ian Rolle, their SEE page 11B Small ‘%’ IPOs find college ‘unwilling’ public buyers By NEIL HARTNELL * BISX chief targeting two befo T r rib e une y Bu o si u ness k Ed n ito o r w it more secondary listings BAHAMIAN ahamian before year-end investors will be “unwilling” invest in an annuity to buy into initial public offer- * Tells Tribune Business ings (IPO) where a substantial market not reaching full customized investment options SEE BUSINESS SECTION portion of the stock remain with the controlling share- potential in absence of guaranteed minimum interest rates holder or shareholder group, other secondary listings flexible accum the Bahamas International ulation period Securities Exchange’s (BISX) chief executive said yesterday.