GLF offered to expand deal

| 19/03/2012

cruise ship at port.JPG(CNS): Despite claims by the premier that GLF construction did not have the money to undertake the cruise berthing facilities in George Town and were unable to do the Spotts redevelopment or the pier in West Bay at the Turtle Farm, a letter from the developer suggests otherwise. McKeeva Bush told the Finance Committee on Tuesday that he had terminated talks with the developer because China Harbour Engineering Company could give government all three projects, but the CEO of GLF wrote to the premier on June last year offering to include the extra sites as part of an expanded proposal.

Following the letter from the premier that had terminated the exclusive talks between government, the Port Authority and GLF, minutes and other documentation have since revealed that the Port Authority and government’s lead negotiator at the time, back bench MLA Cline Glidden, were in favour of continuing with GLF.

The Florida-based Italian company had continued to engage government, regardless the premier’s position, and impress upon it that it was ready to take on the work. The June letter from Francesco Senis states that the financing was in place with Citigroup and in the meantime the firm was able to begin financing the project itself. It pointed to a $14 billion contract in Venice that the company had recently completed and the simulation of the port design, which Bush had been shown earlier that year.

Senis also reveals that talks with the cruise liners had received their support for the financial, design and technical elements of the project, which was expected to result in preferential berthing agreements once government and GLF had signed the main deal.

Despite the position that Bush had taken in his correspondence to the firm in April terminating the exclusive talks, GLF said it had noted government’s intention “to leverage its port assets to secure additional works at Spotts and the Turtle Farm” and was willing to expand its proposal to include these projects.

“We hereby undertake to commit the same expertise and dispatch to these additional projects as we provided on the George Town facility, subject to equal commitment by the government and the signing of the necessary contractual agreements for the George Town project,” Senis wrote.

However, government had switched its attention to CHEC and then signed an MOU with the Beijing-based firm some ten days after Senis sent his offer to government. Later GLF threatened to take legal action, and as a result the government was forced to make a more than $2 million settlement from the public purse.

The premier stated on Tuesday during the Finance Committee hearing when he revealed the cost of the settlement to government coffers that the money would be recovered as a result of the sale of “intellectual property" related to the project. He also cryptically insisted that there were other reasons why the government had decided not to continue with GLF, which, he said, may come out later.

See letter below.

See related articles:

Bush rejects port developers

Chinese get 49 yrs concession

GLF plans legal action

GLF got $2m settlement

Category: Politics

Comments (20)

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  1. Wayasay says:

    Let me see if I have been following this right.
    The Government got rid of GFL for what they said was due cause. – FACT
    GFL thought differently so they sued Government. – FACT
    Govern decided that instead of presenting their case for due cause, it was more cost effective for the Caymanian People to pay GFL $2 million because (as they say) it will cost $3 to $4 million to prove that Government did indeed dismiss GFL for due cause (their words not mine).  – FACT
    Furthermore Government assured us that if we fought the case that the Caymanian People would have to bear the cost of the litigation and went even further to assure us that if we settled out of court it would cost the Caymanian People NOTHING because they would raise the money from the sale of "intellectual property" that they were in effect buying from GFL with the $2 million settlement. – FACT
    Lo and behold the Horerable Mr. Rolston Anglin then did the honerable thing and told us the truth, that we had paid the $2 million fron the Caymanian People's money. – FACT
    Here is where I run out of FACTS as no more facts are forthcoming fron the Government. Please forgive me for indulgeing myself in speculation but everything I write from here on in this post is SPECULATION.
    At some point, either before Rolston spilled the beans or after, the Premier, or his designate, tried to sell the "intellectual property" to the Chinese and they told them to "get lost" because they had their own "intellectual property" and did not need any from GFL ,particularly because the entire scope of the project had changed and what GFL had prepared was for a completely different project to the one the Chinese is going to build. – SPECULATION
    The Government is now left in a position of holding worthless paper that they claim is "intellectual property". – SPECULATION
    The Government is now in the position where they have told the Caymanian People that the settlement would not cost them anything, therefore they have to prove to the Caymanian People that it will indeed cost us nothing. – SPECULATION.
    Now the Government has put the  'Smoke and Mirror Team" (read Public Relations team) into action in order to calm down a restless and unbelieveing public. – SPECULATION
    Here is their ticket to make that happen. Mac tells the Chinese, "Mr. Chinese you will pay the Government $2 million dollars whither you want this " intellectual property" or not. Quit complaining about paying $2 million for nothing, Mr Chinese, I will make it up to you on the Spotts Jetty." – SPECULATION???
    HERE IS THE SMOKE AND MIRROR PLAN. The Government pays GFL $2 million, the Chinese pays the Government $2 million. The Government then agrees to increase the estimated cost on the Spotts Jetty by $2 million without increasing the scope of the project. – SPECULATION
    The people will think that Everybody MAKES $2 million in this exercise. GFL spent $2 million??? to acquire their 'intellectual property" and sold it to Government for $2 million. The Government paid $2 million of the treasury's money to GFL and will be repaid $2 million from the Chinese. The Chinese is left holding the bag for $2 million? The Chinese simply increases the cost in the Spotts Jetty by $2 million for the same scope of work plus another $1 million for the actual changes to the scope of work beyond this. No harm no foul. – FACT
    The Caymanian People are left out of pocket for $2 million which we would have spent under the guise of increased cost of the Spotts Jetty but is really due to the careless way that the Government terminated GFL. – FACT
    The Caymanian People will see through this mess of smoke and mirrors by our Government Ministers and will kick them ALL out come May 2013. – FACT

  2. Fedup says:

    XXXX Guess what people? despite all opposition, despite all that is said, despite all advice from his own, he WILL sign a binding contract with CHEC while still in office and let his successors try and see if it can be cancelled (it won't, not without massive damages)

  3. Anonymous says:

    Prediction: the Cayman Islands will be "asked" to use it's participation position as an associate membership country (AMC) at the UN Global Confernces to vote in China's favour on matters of diplomacy and sovereignty concerning Taiwan, Tibet, and anything else that should crop up.   

  4. Anonymous says:

    The premier is going to recover the 2 million through the sale of “intellectual property"? Pls., give me a break! For the life of me I cannot see that either he or our present government has anything even remotely "intellectual" TO sell!

  5. Anonymous says:

    Mckeeva is a disaster for this country.

  6. Anonymous says:

    CRONY CAPITALISM at its worst and unabashedly overt.

  7. Anonymous says:

    The Chinese give big gifts for contracts. End of story.

  8. Anonymous says:

    And the rabbit-hole gets deeper and deeper every day in Wonderland… did the Premier bother to give them the time of day?  Did he give it any further consideration or engage them in further discussions?   Or had he already made up his mind and just unwaveringly moved ahead with what might have been a hasty decision? 

  9. Anonymously IRON CLAD says:

    CNS/CAYMAN:: Please KEEP UP the PRESSURE on McKeeva Bush !!!

    Keep digging and investigating EVERY MOVE he makes!!!

  10. Anonymous says:

    Caymanian based for how long????

  11. When says:

    When will we finally be rid of this Premier ? The man seems to be XXXX, and Ellio (Mac Jr) is no better. Sometimes I wish C.G. would wake up from his self induced slumber and let us know what really happened, but unfortunately it seems like as the saying goes, birds of a feather, or people who live in glass houses… you know the rest. Alas we will never get to the bottom of this one. Maybe Stefan will finally talk…

  12. Married to a Caymanian says:

    Bush revealed….Bush rejects….Bush promised….Can he please DO SOMETHING besides talk, talk, talk??

    Even the cheapest (Free!)  thing to help the country has not come to fruition.  I was just reminded this week to "Spring Forward" and I remembered our fearless leader promised us Daylight Saving Time.  Hello?  Can't even change a clock?

    DST: I can see it now.  Tourism= "NEW! Cayman adds an extra hour of Sunshine for your holiday" Great campaign and a little free press?  Early bird dinner deals and (2) seatings for restaurants. extra dive trips, more sun equals more tourism.

    Banking=add an extra hour with New York and London, that equates to an extra 20 hours a month of business transactions. What would YOU do with an extra 240 hours of business in a year?

    Most importantly = Fight obesity, diabetes,and add family time.  Get home from work and have an EXTRA hour of sunshine to take get some vitamin D, a walk or bike ride with your kids, or kick a ball around?

    I would like to see at least one of the UDP's "promises" come true.  Anybody keeping score?

    I'm in the dark.

  13. Anonymous says:

    Were there conflicts of interest perhaps?

  14. Dred says:

    I just want to throw this out there and see if it sticks to something.

    So here we are. We have one company who bid and won the right to build the Cruise Berthing . Then they are later dispatched with and in comes another builder who got to the head of the table in a mysterious fashion.

    Now company #1 was very upset and decided they would sue. Their case was settled out of court for X amount. Along comes the new builder who agrees to pay an "intellectual property fee" to the government.

    To me this almost appears that in a round about way that the new builder is paying for the old builder to go away. Is it just me seeingthis? I mean you can dress a horse up like a lady but it don't mean I am going to make a date with it..

    And if this old builder was so messed up why did we have to pay? Commonsense would dictate if they were unable to live up to their end of the agreement they should be renumerating us for loss sales due to their delaying or inability to do what they signed to do. Why did we have to pay?

    I am left with the reasoning that we were simply wrong to terminate and had NO GROUNDS TO STAND ON. If we did have proof of their inability to live up to their end of the agreement we would not have had to pay. Commonsense right?

    Saying that the decision to terminate MUST NOT have been on their inability to finance but our desire to go elsewhere. Why? Was it that the original company could not deliver the full package? Well this letter says no. They could in fact do so. This leads me back to why? Why would you want to do something that would cost the country money? I can only think maybe someone said they would pick up the tab.

    • Anonymous says:

      You hit the nail on the head.  Was this possibly why CHEC offered up $3M as advance payment to CIG on the Spotts Jetty  (which was stopped as the Premier later stated that the UK said no work should start prematurely on Spotts until a proper agreement has been finalized with CHEC).  Maybe Government had intended to use that money from CHEC (the supposed payment on the Spotts), to pay off GLF and ensure they would go away quietly?  Who knows.  If this is what really had happened, then the bottomline will still remain the same – SOMEBODY pays for it in the end, and it won't be CHEC and it won't be those in Government who are making these decisions.   CHEC will make sure they tack ALL their costs onto their construction budget somewhere, on which they will then charge a healthy markup for their profit margins, and they will recover that cost either from an increased share in the revenue from the cruise lines (revenue that will not go to benefit the country) or from an increase in the rental income from the upland facilities.    Either that or CHEC will simply extend their stranglehold lease for longer than 51 years.  And if they can't somehow get their money back, then who do you think will be left holding the bag?  The local taxpayers.     NO SUCH THING AS A FREE LUNCH, PEOPLE. 

  15. nauticalone says:

    It will seem clear to any reasonable and objective person why the prmier (singlehandedly and against ALL advise…even that of his own party) cancelled GLF and went with CHEC.

    Those of a Dictator style mentality will want to stick together.

    Surely dealing with GLF is the better deal for Cayman….XXXX

  16. Profound Reality! says:

    Wrong again, Mr. Bush!

  17. Anonymous says:

    This thing with the port is bigger than Tempura ever was. If we ever to the bottom of this, including the motives behing changing the Port Authority board overnight, a lot of skeletons will tumble out of many closets.

  18. Anonymous says:

    I wonder if anything will actually get done before 2013, or are we completely focused on the Election Campaign