The Great Creditor Rip-off is close to being finalised as two low bids are being considered by Haitong Bank for the two companies that control the Espírito Santo family’s Comporta Estate summer playground and future gold mine.
The Luxembourg administrator of Rioforte, the Espírito Santo Group property offshoot, the one that borrowed from and still owes Portugal Telecom around €800 million, instructed José Ricciardi at Haitong bank to 'advise on' and filter any bids for the two Comporta companies that control the estate.
José Maria Ricciardi suddenly left Haitong Bank last Friday leaving rumours in his wake that he had been 'let go' after falling out with the bank’s Chinese owners over the way he was running parts of the business. The Chinese bank's Chairman, Hiroki Miyazato, (pictured above) has taken over José Maria Ricciardi's role as CEO while senior Haitong management in China ponder how best to reorganise its Portuguese subsidiary.
One of the areas of operation where Ricciardi left himself wide open to accusations of improper behaviour at Haitong is the way he has blocked outside bids for the Comporta Estate, notably the US Merchant Armory fund whcih ha been rebuffed in favour of insiders.
Rioforte Investments owns a 59.09% stake in ‘Herdade da Comporta - Fundo Especial de Investimento Imobiliário Fechado’ and a 58% stake in ‘Herdade da Comporta - Atividades Agro-silvícolas e Turísticas S.A.’ with the minority shareholders in both companies having the right to match any offer made to the majority shareholder.
The estate straddles the Alcácer do Sal and Grândola council areas on the coast between Setúbal and Sines and has planning permission for a major tourist development which significantly has increased the asset’s long-term value.
A low bid, later matched by ‘family’ shareholders in the estate companies would ensure the return of the estate to family ownership at a knock-down price that deprived creditors of the estate’s true worth. The estate then can be developed and spectacular returns are expected for those Espírito Santo family members ‘in the know’ and involved in this crooked deal.
Two astonishingly low bids of around €50 million now have been accepted by Haitong Bank, one from a British vulture fund and another from a Portuguese national “formerly resident in Switzerland and involved in oil trading,” according to our City sources.
The Portuguese national is a close friend to many Esprito Santo family members involved in the estate and both bidders are said to have cut deals with the two men currently in charge of the estate, ‘clan’ members Caetano and Carloto Beirão da Veiga of ‘Back in Line Consulting’ which also is ‘advising’ the Luxembourg receiver on the estate’s sale.
A bid of €50 million would not even pay the €100 million owed to Caixa Geral de Depósitos and is designed to defraud creditors of as much as possible while Haitong Bank continues to claim it has been running a fair and open contest.
This is the old style of doing business in Portugal and one that many businessmen in Portugal are at pains to claim no longer exists after the 2008 economic collapse, the growth of an independent media and the many recent high profile cases that have exposed examples of corruption and sharp practice in both the public and State sectors.
Whether the Chinese bank's Chairman, the Japanese national Hiroki Miyazato, has had any idea what has been going on in the bank's name, remains to be seen but he has a chance now, with Ricciardi's exit, to open the doors to a fair system of bidding for Comporta and sweep away the cozy cabal that has rigged the bidding to date with a view to enriching itself at the expense of creditors.
"In happier times," - Haitong Bank's Chairman, Hiroki Miyazato and former CEO José Maria Ricciardi