TCL shareholders agree to lift 20% cap on ownership
Cement-maker to do rights issue at TT$2.90 per share
Shareholders of Trinidad Cement Limited (TCL) voted overwhelming, at a special meeting on Monday, to lift the 20 per cent cap on shareholding in a move critics say opens the way for the Cemex to take control of the financially struggling company.
Cemex, which has operations extending throughout the world, with production facilities spanning 50 countries in North America, the Caribbean, South America, Europe, Asia, and Africa, is at present the single largest shareholder, at 20 per cent, and would be able to acquire shares worth up to US$45 million in a rights issue.
Former TCL chief executive officer Dr Rollin Bertrand and the powerful Oilfield Workers Trade Union (OWTU) had campaigned against the removal of the cap.
Last month, in a letter to a daily newspaper, Bertrand called on shareholders to reject the proposal that he said would "hand control" of the cement plant to Cemex, a Mexican company regarded as one of the world's largest building materials suppliers and cement producers.
Bertrand, who, along with other directors, was removed last year, said, it is now becoming clear as to why the board had been removed in August 2014.
"This had nothing to do with 'performance' but was really a thinly veiled plan to hand over control of TCL to Cemex, as was proposed by certain businessmen in 2002. Recent allegations in the media have exposed the major players and, no doubt, they are working assiduously to fulfil promises, made over a decade ago to have Cemex control TCL," he wrote.
For its part, OWTU complained that the vote could result in Cemex taking over the company, and such a move could be bad for the economy.
The OWTU, which represents TCL workers, said in a statement that removal of the 20 per cent ceiling on share ownership would "open the door for Cemex to takeover TCL and it would represent a weakening of efforts to build local and regional firms that will create wealth for the country to benefit."
"We believe that any takeover of TCL, by any foreign company,, is inimical to the interests of the TCL workers, the company, the country and the nation as a whole. We will do everything possible to prevent the loss of such a valuable national company to a multinational giant such as Cemex or any other company," the union said.
TCL director Nigel Edwards said the vote sets the stage for the financial restructuring of the cement producer's TT$1.9 billion debt, as one of the preconditions of the restructuring exercise was the removal of the 20 per cent cap.
Edwards said another precondition is that shareholders have to pump at least TT$320 million (US$50 million) into the company which has subsidiaries in Jamaica and Barbados.
At the special meeting on Monday, more than 90 per cent of shareholders voted in favour of lifting the cap.
Prior to that vote, the TCL board of directors passed a resolution to raise a maximum of TT$362 million in new capital through a rights issue of 124,882,568 new shares at a price of TT$2.90 per share.
The TCL shareholders will be offered the right to purchase one new share for every two shares held.
The $2.90 rights issue price is a 24.5 per cent premium on TCL's $2.33 share price at the close of trading on Friday.