Mozambique paid out US$130 million (€123 million) to financial institutions as part of an out-of-court settlement with Credit Suisse to end a legal dispute in the London Commercial Court over the “hidden debts” case.
According to documents presented in court on Friday, Mozambique paid between US$1 million (€950,000 at the current exchange rate) and US$38.2 (€36.1 million) to eight institutions.
These institutions include Banco Internacional de Mozambique (BIM), Banco Comercial e de Investimentos (BCI), Moza Banco, United Bank for Africa, Atlantic Forfaitierungs and the investment funds VR Global Partners, Farallon Capital and ICE Canyon.
Made public on 1 October, the day before the start of the trial taking place in British justice, the agreement has as its main signatories the Mozambican government and the UBS group, owner of the Credit Suisse bank, the main financier of the state company Proindicus to buy ships and maritime surveillance equipment in 2013.
The so-called Transaction Agreement between the Republic of Mozambique, the state company Proindicus, Credit Suisse and other litigants was approved by Cabinet resolution on 6 June, but only made official in the Supplement to the Official Gazette dated 14 September.
“The purpose of the Settlement Agreement is the global and definitive resolution of the dispute between the parties referred to in the previous article and the total and reciprocal waiver of their claims, in litigation, in the case of the litigating parties, and outside of litigation, in the case of the non-litigating parties, regarding responsibilities in the financing of Proindicus,” the publication states.
On Tuesday, the lawyer representing Mozambique’s public prosecutor, Joe Smouha, indicated that Credit Suisse had waived an outstanding debt of around US$450 million, but that it would not pay any compensation to Mozambique.
The payments envisaged by the out-of-court settlement to the other financial institutions that entered into the Prodindicus syndicated loan or had an interest in the deal varied in terms of proportion according to their status as litigants or not.
For example, BIM participated with US$61.2 million (€57.9 million) but received US$38,188,800 (€36.1 million), while UBA contributed US$35 million (€33.1 million) but received US$21.84 million (€20.66 million).
Both were parties to lawsuits brought against Mozambique for non-payment of debts and received a 37. 6% rebate on their initial investment.
Left out of the out-of-court settlement were VTB bank, which was involved in financing Proindicus, and Portuguese bank BCP, which only participated in the loan to the MAM company.
The current trial is the culmination of almost four years of litigation in British justice, to which the African country appealed alleging corruption, conspiracy to defraud by unlawful means and dishonest assistance to cancel debts and claim financial compensation worth millions of dollars.
Mozambique is demanding US$3.1 billion in damages, compensation and indemnity from shipping group Privinvest and its owner, Iskandar Safa, whom it accuses of paying bribes to public officials, including former minister of finance Manuel Chang, who signed the sovereign guarantees on the loans.
The case in the London Commercial Court, part of the High Court, is expected to last until December.
Lusa
