CL bondholders await word on Primera sale proceeds

JCSD Trustee Services is awaiting notification on whether the sale of a Trinidad-based oil and gas subsidiary within the CL Financial Group last month would result in the payment of local bondholders.

Touchstone Exploration of Canada announced on July 11 that it would acquire Primera Group from CL Financial, through its wholly owned subsidiary Territorial Services. The deal was sealed mid-August for US$50.7 million, net of liabilities.

The acquisitions include Primera East Brighton Limited, Primera Oil & Gas Limited, and Primera Oilfield Management Services Limited.

"We have no way of knowing conclusively if this will play a part in the redemption of the notes," said Robin Levy, general manager at JCSD Trustee Services.

CL is in default on a US$240 million bond used to finance its acquisition of Lascelles deMercado and Company Limited.

"As of this morning we have received no final word from CL on the method, source or timing of payment to the noteholders," Levy said at the weekend.

Last month, Jamaican bondholders offered CL Financial an extended deadline to mid-September to determine a payment schedule for a US$240-million bond in default.

That compromise was reached at a meeting in Kingston in which 50 bondholders met with JSCD Trustee, head of CL Financial Alan Holder, and representatives of Black Sand Acquisition Inc, which has made an unsolicited bid for Lascelles.

Levy previously explained that while the bond's principal was in default its interest payments were

always met by the CL Group, which was taken over by the Trinidad government in January 2009.

The parties were expected to finalise payment last month following the initial 2009 default of the bond, issued through subsidiary CL Spirits. Another tranche was issued in Trini-dad, bringing the total to US$342 million.

The CL Sprits bond should have matured January 2010, but CL bought time following a series of negotiations with stakeholders, according to Levy. The amount still owed to bondholders was not disclosed.

business@gleanerjm.com