SBD$140M BOND APPROVED

Cabinet approves SBD$140 million in bond to secure buy-back of LSL and RIPEL Estates

BY NED GAGAHE

In a move aimed at reclaiming the ownership of Levers Solomons Limited (LSL) and its subsidiary Russell Islands Plantation Estate Limited (RIPEL), Cabinet has approved the sale of an SBD$140 million bond to facilitate the buy-back of LSL and RIPEL.

Prime Minister Jeremiah Manele confirmed the decision during a press conference on Monday, highlighting the importance of the move amidst the ongoing liquidation proceedings overseen by Sydney-based firm HALLCHADWICK.

“I want to make the government’s position very clear on the LSL and RIPEL Estates so that there is no misinformation.

“Firstly, an Australian Court had appointed a Sydney firm, HALLCHADWICK as the Liquidators for the LSL and RIPEL Estates.

“This simply means, that HALLCHADWICK had been authorized by the Australian Court to sell these two estates, and payoff the Creditors for the two estates. 

“This process involves, settling all the monies owed to the creditors which will ensure the creditors will transfer 100% of their shares and interests to the Liquidators. The total estimated amount of funds sought to complete this settlement is AUD$25 million, or approximately SBD$140 million.

The Prime Minister said after this settlement, the creditors no longer own LSL and RIPEL Estates.

He said the Liquidator will then pass the titles and interests transferred by the creditors to them, to the entity that provided the funds to settle the outstanding dues with the creditors.

“HALLCHADWICK came to Honiara in February this year to commence the liquidation. At the time, the government did not have a resource plan to secure the amount of funds needed and was on the verge of losing the opportunity to buy-back the two estates through the Court appointed process and enabling other foreign interests to provide the funds and own the two real estates.

Prime Minister Manele stated that the Caretaker Cabinet at the time agreed to raise the $140 million dollars needed through approval of a special Bond market of $140 million for investors to buy. However, it did not have the authority to progress with this at the time as it was a Cabinet in Caretaker Mode.

“I am pleased to inform you today that the Cabinet, approved the sale of $140 million dollars in Bond to raise the funds needed to secure this buy-back through the liquidators, HALLCHADWICK.

“Once funds are transferred and the settlement is completed, some work will need to be done to clean up all the paperwork including titles of pieces of land already sold before handing back the ownership of LSL and RIPEL Estates to the government.

“I wish now to clarify that the government will establish a Cabinet Subcommittee that will be responsible to oversee the development of a mechanism to oversee and governance and management of the two Estates when they are returned to the government.

“This process will involve several steps including:

• identifying and reaffirming people that have already bought pieces of land from these two estates and have already been given legal titles

• Identifying people that have been living in parts of the two estates without legal titles.

• Identifying land that had not been used for future investment and development

“Once the above are established then solutions will be discussed, for instance those already having legal tiles will most likely be reaffirmed.

“The reason the government is involved in this massive investment is to ensure the ownership of the land returns to Solomon Islands and not remain in foreign hands.

“Once the ownership returns to Solomon Islands the Cabinet subcommittee to be responsible through consultations to establish a governance and management system to manage the two Estates.” Prime Minister Manele said.

Meanwhile, elaborating further, Secretary to Prime Minister Dr Jimmy Rodgers said the $140 million is a lot of money that is not appropriated in the government budget.

He explained that the return of full ownership of LSL and its subsidiary RIPEL to the government holds significant cultural, social, and economic implications and long-term economic prosperity, peace and security of Solomon Islands.

Rodgers said the caretaker government had made the decision to secure and buy-back, however, it does not have the authority into actually approved any financial mechanisms.

He said the new Cabinet now has the authority to approve the bond sale.

“So, the three domestic investors are Solomon Islands National Provident Fund (SINPF), Solomon Islands Ports Authority (SIPA) and Solomon Islands Electricity Authority (SIEA).

“For SINPF and SIPA their Boards have already decided they will participate because of the importance of socially, culturally long-term peace and security, getting back ownership, don’t want this to go to foreign ownership.

“So, they agreed they will help.

“If Solomon Power agreed then they will do the same.

“Between, these three institutions they will then buy bonds equivalent to $140 million.” SPM Rodgers said.

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