Report in Atlanta Business Chronicle: Tropical Shipping paid kickbacks to foreign portPOSTED: 08/25/14 11:18 PM
St. Maarten – AGL Resources Inc., the largest national gas distribution company in the United States, sold Tropical Shipping for around $220 million to a subsidiary of Saltchuk Resources Inc., a privately owned company in Seattle. The sales follows on the heels of a report by AGL to the Securities and Exchange Commission and to the US Department of Justice that it had started an investigation into payments Tropical Shipping has made over the years “to local officials and other persons” at a foreign port the company is using. While AGL has never revealed which port it was referring to in its public statement, it is a fact that St. Maarten is one of the Caribbean ports used by Tropical Shipping.
In November of last year, the Atlanta Business Chronicle reported about the kickbacks. “While the investigation is ongoing, we believe that a number of payments were made over a series of years and the aggregate amount of these payments is less than $200,000 based upon information obtained to date,” AGL is quoted as saying in the report.
The Chronicle’s staff writer Phil W. Hudson noted that that the shipping company “has delivered what could be a headache for the natural gas giant.”
AGL said last year that it had voluntarily disclosed the payments to the US Department of Justice and to the Securities and Exchange Commission. The company furthermore stated that it would cooperate with any investigation but that it is unable to predict the duration, scope or result of any investigation.
AGL declined to provide further specifics so that it remains unclear whether the foreign port it referred to is St. Maarten or another Caribbean port. Tropical Shipping has hubs established in St. John and St. Croix. The company was established in 1963 with one boat. These days it has more than a thousand employees, it owns eleven ships and leases three others. Operating revenue last year was $365 million.
So far, there is no information listed about a possible investigation against Tropical Shipping on the website of the Department of Justice. The filing of the payments by AGL to the Securities and Exchange Commission is also not posted online.
In February 2009, Tropical Shipping lost a court case against St. Maarten Port Services. Tropical wanted to terminate its contract with Port Services because it considered the services from this company inadequate.
At the time of the court case it was rumored that Intermar Shipping was about to take over Tropical Shipping, but Intermar-management said in 2009 that it was not involved in take-over talks.
Port Services attorney Rik Bergman said at the time that Port Services is for 80 percent dependent on business from Tropical Shipping.