Canada’s Fortis tries to block sale of B.E.L. shares

There were two weighty cases before the courts today. Submissions were heard before the Court of Appeal in a case against the government, brought by the former owners of Belize Electricity Limited, Fortis is requesting an injunction to restrict the issuance of preference shares to the Social Security Board.  Prior to this afternoon’s hearing, attorneys for both parties agreed that arguments would be no longer than fifteen minutes on either side of the floor, in the interest of expediting the matter.  The court order being sought by Fortis is an attempt to prevent a fifteen-million dollar investment in the financially embattled company, which was approved by the Investment Committee of the S.S.B. on October fifth and is to go before the full Board later this month.  The investment, according to Senior Counsel Eamon Courtenay, would give an edge to the government controlled S.S.B. as a preferential shareholder over the ordinary shareholder.

Eamon Courtenay, Attorney for Fortis

Eamon Courtenay

“Fortis has asked the court to grant interim relief to restrain the Belize Electricity Limited from issuing preference shares.  They are purporting to issue preference shares to the Social Security Board to finance the operations of the company.  We’ve asked the court to intervene and to stop them from doing that because if Fortis wins the case and it gets back the company we would then have a set of shareholders who are preferentially treated, as compared to the ordinary shareholder like Fortis, and the court heard our arguments and adjourned to give us a decision. My clients are not attempting to stop the company from raising the money to finance its operations.  I made that clear on more than one occasions, in fact, I indicated to the court that we would not oppose very strongly the issue of the debentures which they have indicated that they are going to issue and, as I understand it, social security is going to take up.  So, Fortis readily accepts and we stated for the record that Belize Electricity Ltd. must be able to finance its operations, must continue to provide power for the country and it is not the intention of Fortis at all to interfere with that.  What we are saying; however, is that preference shares is not the only way to raise debt and you can do it in another way.  Preference shares has a lasting effect on the company, or at least until they are redeemed, if they are redeemable, and we are asking the court to, in the next few months to issue an order that those types of shares not be issued.”