By Andrew Green, Staff ReporterTHERE IS no "consortium" acting to take control of Kingston Wharves, says Charles Johnston, chairman of Jamaica Fruit and Shipping Company (JFSC).
Mr. Johnston said this view was contained in a response to the Financial Services Commission (FSC). Executive director of the FSC, Brian Wynter, had written to him in February, requesting that he respond to allegations that a "consortium" was acting together to secure control of the Wharves.
"The response was that there is no consortium," Mr. Johnston said. "I am now awaiting their reply."
Several key shareholders in Kingston Wharves have sought to radically alter the Kingston Wharves board of directors, effectively ending the control now exercised by Grace, Kennedy and Company, which holds 42 per cent of the shares.
The February letter to Mr. Johnston was based on his previous position as chairman of the board of trustees of the Kingston Port Workers Super-annuation Fund, which holds 15 per cent of the shares in Kingston Wharves. But JFSC is also one of the entities seeking to reshape the board of Kingston Wharves.
The FSC began a probe to establish whether the group seeking board changes had crossed over the 50 per cent ownership threshold, which would have required that they make an offer to buy out the interest of the other shareholders.
In requesting a response by March 3, Mr. Wynter, in the February letter, said "it would be reasonable to conclude that the entities and individuals, collectively referred to as 'the consortium', came together pursuant to an agreement with a view to obtaining or consolidating control of Kingston Wharves Limited."
However, Mr. Johnston said "the problem is that they have counted votes as being the same as shares. Because somebody votes for you doesn't mean you own their shares."
Wednesday Business was unable to get a response from the FSC about the matter.
From the standpoint of Grace, Kennedy, its chairman and chief executive officer, Douglas Orane, said the next step would be a trial over the issue of the Shipping Association of Jamaica (SAJ) shares in Wharves. These shares had been vested in the SAJ and not in the names of the trustees, Harry Maragh and Grantley Stephenson.
The Trade Union Act states that all property owned by trade unions, including the Shipping Association of Jamaica, should vest in their trustees. Neither Mr. Maragh nor Mr. Stephenson were available for comment. Last week, 103.3 million Kingston Wharves shares were traded in two block transactions on the Jamaica Stock Exchange. Block transactions allow for the transfer of shares between closely related parties without the usual charges.
The Shipping Association held 110.5 million Wharves shares in December, last year.
An extraordinary general meeting, which the dissenting shareholders had wanted to use to change the present board of directors, would not be called before the Shipping Association trial was held, Mr. Orane said. The Supreme Court had granted an injunction in February, preventing the holding of the meeting before the matter was tried.
Quoting a comment by attorney Lord Gifford on the Shipping Association issue, Mr. Orane said, "regarding matters affecting control of a company, once a court has been apprised of serious issues affecting voting rights of shareholders, it is not proper in law or good sense for the meeting to proceed before the issues are determined by the court."
Mr. Orane said, "all parties have accepted this position."
