~ APS pulls out of loan negotiations while bank overdrafts are canceled. ~
PHILIPSBURG: --- The financial situation of the country’s telephone company, TELEM, has worsened in recent months. TELEM is finding it difficult to pay its creditors due to the lack of proper cash flow.
The situation worsened since the Supervisory Board of Directors (SBOD) opted to publish the Chief Executive Officer’s position (CEO) as the recruitment for a candidate began.
Banks on the island have since canceled their overdrafts with TELEM since it is clear that the current CEO, Kendall Dupersoy, will not be in that position come January 2025. Therefore, committing the company to long-term financial commitments is not feasible for any institution.
APS pulled out of the loan negotiations, citing the company's lack of long-term leadership.
Currently, Dupersoy is the only person in management with the longest service record; TELEM's Chief Financial Officer was appointed just over a year ago, and there was no CTO or COO in place. BDO also published these positions, but to date, they have not been filled.
Last week, the Minister of TEATT, Grisha Heylioger Marten, announced that the government of St. Maarten was considering purchasing the TELEM main building on Pond Island to house the Parliament of St. Maarten. Still, no concrete decision has been made regarding that plan. In the meantime, Prime Minister Luc Mercelina said last week, when asked if the government was going to bail out TELEM from its financial woes or if the government was thinking of selling the company, that as a shareholder, the government would have to do everything possible to assist the company since it is a government-owned entity.
Some research conducted by SMN News showed that TELEM's management tried to salvage the company by making several proposals to the Supervisory Board of Directors, one of which was the sale of the main building, which the SBOD rejected.
The Governor’s office had offered to purchase the two top floors of the SMITCOMS building, which was also rejected by the SBOD. Information showed that those two floors remained empty, and TELEM has not earned any income from them.
TELEM management also proposed that the company sell the Cable TV Building and the ITELSA Building in Cole Bay, all of which was rejected by the SBOD, which believed that the company should hold on to its assets. Had these buildings been sold, TELEM would have accumulated at least $10M, which would have served as their own bailout.
It is only a matter of months, if not weeks, that the financial situation at TELEM will get to the boiling point and the company would have to think about filing bankruptcy if the shareholder does not find a salvageable solution almost immediately.
