NICIL Chair admits no due diligence on bidders was conducted

The revelation that Pricewaterhouse Coopers, Guyana Sugar Corporation’s (GuySuCo) asset valuator, has been under investigation by Indian authorities for fraud has come as a surprise for many, including those at the National Industrial and Commercial Investments Limited (NICIL).
When contacted by this publication, NICIL Chairman, Dr Maurice Odle affirmed that he had no prior knowledge of the probe into the firm that lead to a two-year ban and a fine from Indian regulators.
“It’s difficult to find an international company that has been operating throughout the world that has not been accused of some transgression at some point in time,” the NICIL Chairman stated.

According to Odle, however, Special Purpose Unit (SPU) head Colvin Heath-London should have done due diligence on all the companies who bid for the contract. Guyana Times International made contact with Heath-London, who declined to comment on the company’s blacklist. He did, however, note that a statement would be issued on the matter.
When contacted, Agriculture Minister Noel Holder also declined to comment. He insisted that PwC and the SPU fell under the auspices of NICIL and thus, the Finance Ministry. This is despite the fact that the company will be valuating GuySuCo, one of the biggest agencies under the Agriculture Ministry when budget allocations are considered.
Blacklist
According to a report originating from international news agency Reuters, the company was handed the two-year ban last week for allegedly overstating earnings and assets for Indian Software Company, Satyam Computer Services.
The report states that PricewaterhouseCoopers was the audit firm at the time the more than $1 billion fraud occurred. It was the founder of the company, Ramalinga Raju, who blew the whistle on the fraud in 2009, costing shareholders billions and shaking the industry.
Besides the ban, the Securities and Exchange Board of India has handed down an order for Pricewaterhouse Bangalore and two of its former partners to pay 131 million rupees or US$2 million, plus interest, in forfeited funds. This must be done within 45 days, with the ban taking effect on March 31.
In its defence, Pricewaterhouse is quoted as saying it will appeal the regulator’s decision in court. It has defended itself by affirming that there was no “intentional” wrongdoing in the fraud at Satyam.
Government has long made known its plans to close the Enmore and Rose Hall sugar estates, sell the Skeldon Sugar Factory, reduce the annual production of sugar, and take on the responsibility of managing the drainage and irrigation services offered by GuySuCo.
GuySuCo, which was saddled with billions of dollars in debt, is currently engaged in divesting its assets to get cash to meet its operational and other expenses. At the same time, Government is forging ahead with downsizing the industry, citing the economic feasibility of the sector. At present, the SPU is in charge of this process.
That Unit was first announced by Agriculture Minister Noel Holder, when he presented a Policy Paper to the National Assembly on the future of the sugar industry. It was allocated some G$130 million “to provide for the establishment of a Special Purpose Unit to manage the reform of the sugar industry.”
In July, the Government had presented a supplementary request to tap the national coffers. The National Assembly has since approved the monies for the Unit, which is based at the Kingston Headquarters of NICIL.
At the time monies were being approved for the Special Purpose Unit, Finance Minister Winston Jordan had said Government was unclear as to what it is looking to rake in from the sale of the GuySuCo’s assets since they still need to be properly evaluated.
As such, some G$60 million was approved to hire an accounting firm, in this case Price waterhouseCoopers, in order to lead the divestment process. After tendering, PwC was chosen ahead of several other companies to do updated valuations of GuySuCo’s assets. As of Monday, the company has already commenced its work.