MOZAMBIQUE will turn its attention to pursuing compensation from shipbuilder Privinvest in London, officials said on Monday, after the republic struck an 11th-hour settlement with Credit Suisse over the $1.5 billion-plus “tuna bond” scandal.
Mozambique Finance Minister Max Tonela confirmed at a Maputo news conference that Sunday’s deal with Credit Suisse’s parent UBS and some creditors only covered a 2013 loan to Proindicus, a state Mozambican company, and was “mutually advantageous”.
“This agreement opens the door to the possibility of restoring the confidence of international investors in Mozambique,” Tonela said.
The tuna bond case dates back to deals between state-owned Mozambican companies and shipbuilder Privinvest – funded in part by loans and bonds from Credit Suisse and backed by undisclosed Mozambican government guarantees in 2013 and 2014 – ostensibly to develop the fishing industry and for maritime security.
But hundreds of millions of dollars went missing and, when the government debt came to light in 2016, donors such as the International Monetary Fund temporarily halted support, triggering a currency collapse, defaults and financial turmoil.
Mozambique has said it was the victim of a conspiracy and that Privinvest paid bribes to corrupt Mozambican officials and Credit Suisse bankers, exposing the nation to a potential liability of at least $2 billion.
Tonela and Deputy Attorney General Angelo Matusse declined to say how much compensation Mozambique is now pursuing from French shipping mogul Iskandar Safa and his Emirati-Lebanese shipbuilder.
Safa and Privinvest – which has said it delivered on its contractual obligations and any payments made were investments, consultancy payments, legitimate remuneration or political campaign contributions – have denied any wrongdoing.
Sunday’s settlement, struck one day before a blockbuster London trial was due to begin, prompted scores of lawyers representing Mozambique, Credit Suisse, Privinvest, three former Credit Suisse bankers, creditors and others, to gather in the High Court to establish how the trial should now proceed.
Judge Robin Knowles said there was an imperative to ensure the three-month trial of a “complicated and interwoven multi-party case” was fair to all parties and postponed the opening of the trial to at least October 16.
Duncan Matthews, for Privinvest, told the court that the settlement had created a “significant shift” in burden to his clients and that they should have time to work out which claims and cross-claims remained on the table.
He also noted that it was “not quite clear” whether Mozambique’s claims against three former Credit Suisse bankers had also been settled or put on hold.
The deal includes “the extinguishment of the total amount of debt that Credit Suisse claimed from Mozambique”, read a statement posted after the press conference on the Facebook page of Mozambique’s Attorney General.
Under the deal, UBS will forgive part of a loan that Credit Suisse made to Mozambique in 2013, representing less than $100 million, said one source familiar with the situation, who declined to be named because the terms are not public.
Mozambique is paying 3.5 million pounds ($4.26 million) per month to its London legal team. Legal fees have swollen to $80 million since 2019, Matusse said.
