Clico (Guyana)’s chances of getting back any of the money it transferred to Clico (Bahamas) took another turn this week as the liquidator initiated proceedings to prevent a fire sale of the Bahamian company’s main asset, Wellington Preserve Corporation.
According to the Tribune Business of The Bahamas, “Clico (Bahamas) liquidator [Craig Gomez] has sought a 90-day extension from the US courts to reorganize the affairs of the property that accounts for 63 per cent of the insolvent insurer’s total assets, in a bid to avoid a ‘fire sale’ of a development worth ‘enormously in excess’ of the liens against it”.
The report said that Gomez also wants more time to complete Wellington Preserve’s sale to a new buyer since the potential deal with initial front runner, the Hines Group, has fallen through. Gomez is both president and director of Wellington Preserve Corporation.
In his August 10, filing with the US courts, Gomez and his attorneys said they placed Wellington Preserve in Chapter 11 bankruptcy protection after the Hines Group deal collapsed. Wellington Preserve needed to be protected from a US$1.5 million judgment entered against it and numerous creditors, who include the US Internal Revenue Service (IRS).
In the filing, he said that the property is “presently encumbered by outstanding and unpaid real estate taxes; a judgment for approximately US$1.5 million, a certified copy of which was recorded during the preference period; and minor mechanic’s liens claims totalling less than US$50,000.
“In this very unusual case, there is no mortgage. The entire parcel, before some lots were subdivided and sold, was purchased for US$55 million in 2004. The estimated ‘as built’ sellout for the lots was over US$120 million. As is, even in the economy of today, the property is worth tens of millions of dollars-enormously in excess of the encumbrances,” the Tribune report said.
