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Sep 5, 2011

Sugar Cane Association get financial backing from Mexican Group

The Belize Sugar Industries (B.S.I.) has until the end of September to pay at least thirty million dollars in debt that matures with the ING and FirstCaribbean Banks. Time is running out and a strategic investor has still not been secured to prevent insolvency. The Prime Minister is on record to say that the ninety million dollar proposal from Honduran Banco Atlantida is the only deal in town to acquire majority shares in B.S.I. But as soon as that was uttered, the Belize Sugar Cane Farmers Association (B.S.C.F.A.) announced that it also had an interest in acquiring majority control in B.S.I. to keep the industry in Belizean hands. The industry did not reach the production target this past season but the quality and efficiency had improved. And this morning, the farmers’ representatives said that they have been able to secure financing. According to the B.S.C.F.A., representatives from the Sterling Group from Mexico have done their due diligence and they are willing to back the B.S.C.F.A.’s buyout of the factory.

Alfredo Ortega, Chairman, Committee of Management, B.S.C.F.A.

Alfredo Ortega

“About two weeks ago we sent a delegation to Mexico seeking finances for the farmers acquiring majority shares in B.S.I.  We have been successful in that we had a visit of two members of the Sterling Group from Mexico who came to do their due diligence so that they can see how the position is and if it is viable for them to invest that money on the farmers in granting us that loan to get majority shareholders.”

Delahnie Bain

“And would this loan cover the debt owed by B.S.I. plus the purchase of the shares? How would it work?”

Alfredo Ortega

“The amount that we are seeking at this point in time is the twenty million that is owed to ING, the three point four million US dollars that is owed to the workers in dividends plus the rest amounting to thirty-five million dollars for working capital. So it’s in the vicinity of ten to twelve million dollars in working capital that we are trying to manage.”

Delahnie Bain

“Can you tell us a bit more about the Sterling Group?”

Alfredo Ortega

“The Sterling Group is a group that works finding financiers and they develop—they have worked in different groups. This group has developed finance for Bancomer and Nissan in Mexico and other groups that have been developed here. So they are coming here with us based on the visit by our delegation and that have seen that the industry in Belize is very viable.”

Delahnie Bain

“How would you say your—what you have been able to work out with the Sterling Group, how would you say that compares to the proposal from Banco Atlantida?”

Alfredo Ortega

“The proposal from Banco Atlantida is that they want to invest but they want to become producers also. There are certain changes that they want in the Sugar Industry Act to be done that will favor them. Versus us, what we are seeking for is the industry to remain in Belizean hands; not only in the farmers hands but in the workers hands so that we can have a viable and a benefit within in the industry.”

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13 Responses for “Sugar Cane Association get financial backing from Mexican Group”

  1. Sugar says:

    the industry is where it is because of a complete lack of cane…NO CANE has led to decreasing production for over 10 years now. that is the reason Atlantida needs to ensure that they can plant cane and GOB is fully cognisant of this. getting farmers to try to manage the factory just as they have mis-managed the BSCFA, then the banks will pull out completely. instead of tring to play as manufacturers, they should take their jobs as farmers seriously and…GO PLANT THE DAMN CANE.

  2. javier solis says:

    These farmers are living a pipe dream. There is no way anyone wants to see this group of quixotic tempermental people own the factory. I would give it a year, if that much for the place to close down. Ortega even at this moment is fighting for survival where half his committee is plotting to see him go down. So i say it would be suicidal to comtemplate a group like this to manage a hundred million dollar industry.

  3. david says:

    Why some of you load mouth try to plant some cane and then wait to get pay in parts and see if you would survive as these same came farmers that you are badmouthing. Maybe you don’t even know how a cane plant looks like.

  4. javier solis says:

    David above is assuming things he is not aware of. Why do you think i talk about sugar? Because i know, you bubu. I also talk about farmers because i am one. The leaders of the BSCFA are corrupt and greedy. All they are fighting about right now is who will be the big boss if they move at BSI as managers. Imagine the chaos that will happen like the core sampler issue! I say again, alll the Fairtrade funds have gone, over $20 million, to cronies and connected people in that association. If the BSCFA has been the cause of the industry failure to pay its loans, how will they change this course? The BSCFA is incompetent!!!

  5. aldo says:

    As an orangewalkeno I will try to explain as simple as possible B.S.I.’s problems. They started when Mr Mcfalane left and Mr Montalvo took over .At that time B.S.I. had 10′s of millions in reserve. He went on a free for all for his family and all the B.S.I. compound staff. these guys raped B.S.I. dry and are still in and noone is doing anything but putting the blame on something else. For the lifestyles of the rich and not famous visit the B.S.I. compound see how they live and see what salaries and lifetime packages these crooks have. You will be shocked !!!

  6. Belizean says:

    During Mr Mcfarlane tenure, he also got the same benefits, I’m sure. So if we will chastise those at the top of the hierarchy at BSi, lets chastise the CEO and board from all the utilities too, and CPBL. Ever wonder what their salaries are? Heck let the government pass a law that everyone making over $50k a year pay 50% income tax so they stay within the same earnings as these haters…! that way the haters can justify their failures and feel better about themselves..!

  7. orangwalkman says:

    hey aldo, same point i was thinking about…..we have heard blame placed on everyone except BSI management. I fully support your idea and think we need to start looking at the present management. But then again, what the management has done is embraced capitalism…something so many people love…

  8. Ziberio says:

    I WANT TO INQUIRE: WITH THE MONIES OWED, DOES MR. MONTALVO AND HIS CREW GET PAID????I IMAGINE, EVERYONE GETS PAID; SO THEY TAKE THE LITTLE OF MONIES, THEN THE BALANCE OR THE RED STAYS BEHIND, IS THAT TRUE OR FALSE????

  9. david says:

    Mr Solis…can you tell us who borrowed the money … what for who spent it and who should pay it back….I can recall when the sugar industry was the backbone of our economy…I didn’t know you were a farmer or you wouldnt be saying these farmers… as a small horticulture farmer I would like to have the same ambition as these farmer to invest and have security in an industry …what about Belcogen???

  10. Ricky Malthus says:

    Admittedly I am not privy to the financials of neither BSI nor The Cane Farmers Association. But what ido know is that the Association must match the debt they are assuming or payoff to the tangibles they are receiving for them. Example, if the Association pays $20 million debt, then they must show acquisition of $20 million in acquired assets. If this is not so, then it is a bum deal.

    Although Belizeans suffer from the colonial hangover of backstabbing and backbiting. the deal can work if they improve management, teach farmers about the wonders of entrpreneurship and pride of ownership of their own businesses, and the beauty and benefits of well trained owners and workforce. I see the point of Sugar and Javier Solis but we are an independent nation responsible to ourselves for our actions. If there are incompetent management , such staff must be removed as they impact negatively the profit margin of the sugar industry. In all the English post Colonial countries, the government and people have drunk of the insidiousness, malice, and envy that the Colonial masters planted and nurtured amongst the population. But you have to put those things aside and start working and managing to increase productivity and profits to pay off the loans to Sterling Group and other creditors. Surely no one knows the future and cannot say or talk down the project. Otherwise nothing would get off the ground in Belize. We still are not truly independent since we don’t have independent, critical thought. But full speed ahead with Association buying out BSI.

  11. DT says:

    What hasn’t been asked is what happened to the 130 MILLION BZ$ granted to the sugar industry by the EU recently?

    That was supposed to increase production and upgrade the factory to enable Belize to become a first class sugar producer, with a world class product?

    Where did that go?

    30 years of Independence and we’re no better off than we were bfore 1981, i fact we’re a lot worse off, as we have the 2 parties stealing from us and a 3 BILLION dollar bill to pay, which will affect generations and stifle any further chances of growth, and now the Brits have almost completely pulled out, could be facing invasion from Guatemala. Oh, hang on, they are doing that already with impunity, aren’t they? Plus thousands get sworn in as Citizens during election time….

  12. Indy says:

    I agree with Ricky Mathus and DT. In the corporation world, if the CEO, Exec Dir or anybody in management is not producing any result he or she will be fired. We want to see results. We want people that are experience and that have shown results in the previous work. Having said that BSI top management for the past years have not show any result. Ok, I am sure people will go ahead and point fingers at the Cane farmers at this point, but that is another issue. Let us just focus at one issue at a time. We need another person that is fresh, energetic, experienced in the SugarCane world market and someone what will give us results. Someone that would treat this as a business.

    As for the Cane farmers, they need to revise the laws its is too old. They need an audit and see how they are spending their money. Furthermore, they need a person that is educated and experienced in conducting meetings. In no way am I saying that the farmers are dumb because education is not a measurement of how smart you are. What I am saying is they need a person that is more capable and more appropriate for the position. I have written a paper and I have some recommendations on what the BCFA should do to improve management and how they save lots of money.

    I am proposing for them hire a full time CEO or Exec Dir and that those elected farmers along with independent members should only act as board members/advisors to the CEO/Exec Dir. In this way the Exec Dir or CEO answers to the Board members and both of them to the BCFA members. This way less corruption…etc I have examples of how this has worked in other countries. The way it is now is that there is no board of directors. The elected farmers directly reporting to the farmers which never works. They need a body that monitors the CEO…etc. I have details of how much they would save and how this would work.

    Yes what happened to the EU grant and the recent use of Fair trade money that was designated for the farmers. Was it spend in Belcogen? Farmer’s were paid last year because their money was spent in Belcogen. BSI is owes them (the government paid them). If you were to go on Fair trade website, it will say that all the money went to the farmers which in reality some of it went to BSI and how they spent it is another story like wise the BCFA.

  13. Corozaleño says:

    Good Day,

    I am on the same page and agree with javier solis and orangewalkman. BSCFA management has been corrupted since the 80´s or more. Did you know that the sugar cane act has a clause that states that the members of that management cannot be taken to court for and financial mishaps? I truly believe that the deal of Atlantic Bank is an opportunity (a rebirth) for the sugar cane management and cane farmers to restart. Dismiss all members of the BSCFA Management and replace them with young, academic and willing individuals. While for the Cane Farmers, its the time to push the “reset” button in their financial system, strategies and methods on the growing of sugar cane. I am a son of 2 retired canefarmers (with small and meduim size couta), before the year 2000 my parents saw that there was limited or no profit in the business of sugar cane. My parents invested wisely, yes the sugar cane was the economic heart (60s-80s) of Belize, but there were few cane farmers with similar thinking and stratigic investment as my parents. For that the two political parties are to blame, they separated the Cane farmers in giving and allowing the sugar cane license to individuals that did not have land to plant the product just for a votes. Moreover, majority of Cane Farmers are to blame, for tranferming a great campesino livelihood into a culture of modern slavery wage system. That is, Majority of Cane Farmers have maintained a bad system of credit in the banks.
    Cañeros!! Its time to change your way of do business! its your product, your land and your livelihoods.

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