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Cayman Island utility company trying to recover money stuck in Belize

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Posted: Thursday, October 11, 2018. 8:52 pm CST.

By BBN Staff: Cayman Island-registered utility company, Consolidated Water, is reported to be considering selling its operations in Belize due to difficulties the company has been having in repatriating its profits from the country, according to filings with the United States Securities and Exchange Commission.

The company is headquartered in the Cayman and operates in Belize, the British Virgin Islands, the Bahamas, and Indonesia. In its filings, the company explained that repatriating profits from Belize requires the approval of the Central Bank and is dependent on the amount of US dollars available to Belize banks to execute such transfers.

“Weakness in the Belize economy and other factors have reduced the amount of US dollars that Belize banks have available for transfer, which has limited the amount of funds we are presently able to transfer from CW-Belize,” the company said in a recent second-quarter report. “Our repatriations of funds from CW-Belize to our parent company amounted to $458,000 and $400,000 for the years ended Dec. 31, 2017 and 2016, respectively, significantly less than the net income and net cash flows CW-Belize generated for those years.”

The company has reportedly now entered into a non-binding memorandum of understanding with Belize Water Services Ltd. to sell all of its shares – under the condition that Belize Water Services helps facilitate the conversion to US dollars so that Consolidated Water can repatriate all the cash it holds in Belize.

Under this agreement, Consolidated Water has been able to repatriate US $2.75 million in cash from Belize to its bank accounts in the Cayman Islands over the past three months, representing a marked increase in the amount of cash that the company has been able to transfer from its accounts in Belize in recent years, according to the company’s CEO Rick McTaggart. The deal isn’t finalized yet but is expected to be completed soon with the government having acquired a US $8.5 million loan to, among other things, acquire the shares from CWS.

 

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