Raffique Shah


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When corporate raiders strike

June 02, 2002
By Raffique Shah

I KNOW little about Krishna Persad, the founder of Mora Ven Holdings Limited, except that for many years he has been considered one of the local experts on oil. In fact, his name first came to my attention through a newsletter-type publication he wrote, printed and circulated, that kept those of us who had an academic interest in the industry informed. It was a kind of indigenous Platts Oilgram, the latter being a virtual Bible on matters pertaining to the global oil industry. I also know enough to tell me that Mora Ven was his dream, his vision for relatively "little" people to have a stake in an industry that is dominated by big corporations.

Two weeks ago, Persad lost control of the company to a man named George Nicholas. Well, Nicholas was the main shareholder behind the hostile takeover, but there were others involved. Those who moved to kick Persad out of chairmanship of the company are people who legitimately bought shares in Mora Ven when the company went public a few years ago. Like most companies that move from private corporations to the public domain, to being listed on the Stock Exchange, Mora Ven probably did it to raise the capital necessary to expand the company.

I kept abreast of the battle for the company as it was played out in the media. Huge press advertisements started appearing in the dailies, the texts of which were not exactly complimentary of Persad and the way he ran the company. And Nicholas, who comes from a family that seems to have a bottomless pit of dollars, offered shareholders substantially more money per share than its listed price, quick profits that not many could resist. Then I saw the ubiquitous Lloyd Cartar show his face (and hand) as both a shareholder and a Nicholas-backer, and I immediately sensed that Persad was in more trouble than he thought he was.

What he was facing was an organised and well-orchestrated plan to relieve him of Mora Ven. When the annual general meeting of the company was called, Persad thought he had sufficient support to edge out Nicholas. After all, he owned 30 per cent of the company. Surely, support from others who owned another 21 per cent would see him retain control of Mora Ven. That was not to be, though. Persad came face to face with the sharks in the world of business, not to add snakes that would eat the food you serve them-then turn around and gobble you up, macajuel-like. Nicholas had more corn, as we Trinis would say, so he could feed more fowls. Especially "yardfowls" that thrive on human waste.

When the votes were counted at the end of the AGM, Persad realised that he had lost control of his "baby", albeit by a narrow margin. In publicly owed businesses, as in our political system, all it takes is one mini-shareholder or a handful of dumb voters to swing things one way or other. Now, he is fighting back, but again, I sense that his rearguard action has come too late. I'll be surprised if he should ever sit in the Mora Ven chair again. He who had the vision and who took the risks to build a unique company, who dared to venture where local big businesses feared to tread, has lost out to those who live by the power of the almighty dollar.

Why am I focussing on Persad's loss, on what people might view as a private affair? I'll tell you why. I have lived my life by the creed that says when injustice is done to anyone anywhere in the world, one must be man enough to stand up and speak out against it. That's why I recently used valuable column space to focus attention on the abortive coup in Venezuela, on Israel's criminal invasion of Palestine, on the India-Pakistan conflict that only now has the world powers running helter-skelter. Today, I feel for Krishna, for what he was subjected to at the hands of the Philistines of the business world.

A well-respected pioneer in the energy sector told me that many years ago Krishna had told him he (Krishna) was sure that the elusive "vein" of crude that linked Venezuela and Trinidad ran through the central part of this island and then meandered off the East coast. Some 30 years later, BHP Billiton struck the biggest oil find since Amoco's along the same line that Krishna had spoken about. He had also projected that oil lay below some of the gas fields that were known to exist, that companies would have to drill deeper to find that oil. That, too, is proving to be a good prognosis, the pioneer said.

"Those fellas (who took over Mora Ven) may have money, but do they know anything about oil and gas?" he asked. "Krishna saw an opportunity in secondary drilling and went after it at a time when many in the industry felt it not feasible or profitable. That's how Mora Ven came into being. They can't buy that kind of expertise." And therein lies one of the contradictions of unbridled capitalism, of how unjust such a system could be, especially to bright local professionals who venture into businesses believe they are expert at. They may have the knowledge, the vision and the daring, but when they don't have the capital to either start up or expand business, they fall prey to the well-heeled vultures who create nothing but are ever-eager to feast on hapless entrepreneurs.

About a decade ago I saw it happen to a colleague of mine, Major Joseph Mader, who was recently murdered. Joe pioneered commercial and industrial waste disposal in this country, starting out with one truck and a few bins in the early 1980s. In short time the business boomed and soon he had a fleet of waste disposal trucks lumbering across the country. Then he made the mistake of inviting other persons to buy shares in the company in order to raise capital. To cut a long story short, just when the company was on a solid growth path, Joe was cut down by someone he thought was his "partner". The bank turned its back on him and he was booted out of a multi-million-dollar business almost penniless. He died without getting justice.

I guess the hard-nosed businessmen who kicked Krishna in the pants would tell us that that's what business is all about. Surely, though, government must put mechanisms in place to protect this country's visionaries, its pioneers-turned-entrepreneurs. Otherwise we'll see many more Krishnas and Joes fall victims to corporate raiders.

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