To: All
CANADA'S NATIONAL NEWSPAPER
THE GLOBE AND MAIL
REPORT ON BUSINESS
MONDAY, DEC. 1, 1997
Chr‚tien endorses delisted Fenway in Philippine deals
Advisers say PM unaware of VSE move
BY SHAWN McCARTHY
Parliamentary Bureau
0TTAWA --- Prime Minister Joan Chr‚tien has inadvertently given an endorsement to a Vancouver mining company that has been de-listed from the Vancouver Stock Exchange.
As part of an official visit by Team Philippines to Canada, Mr. Chr‚tien and Philippines President Fidel Ramos officiated Saturday in a signing ceremony here of 26 business agreements between Canadian companies and Filipino partners, potentially worth nearly $2-billion.
The deals included a memorandum of understanding between Northern Telecom Ltd. of Brampton, Ont., and Philippines Communications Satellite Corp. and CALL Telecoms to construct a telecommunications network, worth an estimated $400-million, and an agreement between Montreal-based AFCAN Inc. and Primetown Property Group of Manila to build and manage 311 ambulatory care centre in suburban Manila, worth about $62-million.
But the biggest deal - valued at $548-million -- was between Fenway Resources Ltd. of Vancouver and Central Palawan Mining and Industrial Corp. of Manila to develop an integrated cement plant complex on the Filipino island of Palawan.
During the ceremony Saturday in the ornate reading room Of Parliament's Centre Bloc, Fenway president John Wilson and his Filipino partners were among the scores of business people to be greeted by the Prime Minister and Mr. Ramos.
In May, the Vancouver Stock Exchange delisted Mr. Wilson's company because it said it had misled shareholders about a number of issues, including the state of the company's environmental approvals for the Palawan project.
Mr. Wilson said Saturday that Fenway shares are about to begin trading over the counter in New York.
During the ceremony, Mr. Chr‚tien extolled the growing trade and investment relations between Canada and the Philippines and praised the business people who had concluded agreements.
"The strategic business partnerships formed here today mean more opportunities and jobs for both Canadians and Filipinos," he said.
Mr. Chr‚tien's director of communications, Peter Donolo, was surprised when told by a reporter during the ceremony that Fenway had had problems with the stock exchange in Vancouver. Leslie Swartman, press secretary to International Trade Minister Sergio Marchi, said after the signing Canadian officials were unaware of the controversy.
"The signings, the whole process was driven by the Philippines," Ms. Swartman said.
She added, however, that Fenway's problems with the VSE don't mean the project is threatened. "It's a real contract, and the Philippines are very excited about it," she said.
Asked whether Ottawa was concerned about boosting the credibility of a company that had been kicked off the Vancouver Stock Exchange, Ms. Swartman said the company was "innocent until proven guilty and that refusing to allow Fenway to participate in the ceremony would amount to an accusation of guilt by the Canadian government.
In a May news release, the VSE said Fenway reported as "accounts receivable" in its financial statements $488,593 in unsecured loans to companies in which Mr. Wilson and other Fenway officers were directors.
It also said Fenway's investor relations and promotional activities "have in certain instances been misleading and appear to have breached the Securities Act." Among the most serious issues was the company's claim it had obtained an environmental compliance certificate for the Project when, in fact, the process was not complete.
In an interview just after the Saturday ceremony, Mr. Wilson denied he had misled shareholders and said the company has appealed the delisting to the B.C. Securities Commission.
"The stock exchange found that in their opinion they said there was a lack of true information from the company to the shareholders," he said. "The companv very definitely denies that. There was no wrongdoing."
He said the stock exchange relied on information from the Department of Environment and Natural Resources and from nongovernmental organizations (NGOs) that are opposed to the project and have, themselves, been providing misleading information.
He said the Palawan cement project --- which is projected to produce 2.5 million tonnes of cement a year received environmental approvals from the Palawan Council for Sustainable Development, a provincial body that can authorize the issuances of environmental certificates.
The chairman of the Palawan Council for Sustainable Development, Filipino congressman Alfredo Abueg, also attended the Parliament Hill signing ceremony. He insisted Fenway's regulatory approvals were in order.
"I would not be here if we did not support the project," Mr. Abueg said.
He blamed the controversy on "a small group of tribal minorities who are being used by NGOs, protesting it".
The non-government organizations claim the project - which will mine limestone from the area - will force some indigenous tribes to relocate villages and could destroy local water supplies.
Fenway and its Filipino partner say no relocation is necessary and the partners will provide improved sanitary conditions, including deep wells for local villagers. |
