The privatisation of the Bahamas Telecommunications Company Limited will be further delayed now that the deadline for submission of preliminary bidding documents to the Ministry of Finance has been extended from January 10, 2003 to February 24, 2003 .
The long-awaited bidding received a one-month extension after an overwhelming amount of persons expressed interest in acquiring a stake in the company, according to ministry officials.
Officials say the extension will allow all parties that have registered their interest in purchasing the telecommunications company and who meet the pre-qualification criteria to conduct their due diligence and prepare their submissions to the Ministry.
The Ministry of Finance has placed a series of advertisements in the dailies notifying the public of the deadline change.
Rowena Bethel, legal advisor at the Ministry of Finance told the Bahama Journal yesterday that she expects a delay of the privatisation to a certain extent.
“I guess there will be a delay insofar as we would’ve looked at closing in relation to a strategic partner, so the length of time could be extended because the deadline has been moved,” she said. “A strategic partner may end up negotiating for a long time, so you really can’t say.”
Ms Bethel said to date, 33 bidders have expressed interest in the corporation.
“The names of these bidders will not be released until preliminary bidding has been concluded on February 24, 2003 , but it’s unlikely that anyone will be submitting at this stage,” she said.
The government currently owns 100 percent of BTC. It intends to sell a 49 percent stake in BTC and will transfer management control in BTC to the strategic partner. The transfer will take place by way of a public tender “share sale.”
As of June 30, 2002 , BTC had 125,400 fixed line subscribers, representing a fixed line penetration rate of 41 percent and some 95,800 pre-paid cellular subscribers, representing a cellular penetration rate of 31 percent.
For the financial year ended December 31, 2001 , BTC’s revenues were US $226 million and its earnings before interest, depreciation and amortisation were US $100 million. The company’s net assets as of December 31, 2001 were US $287 million.
BTC will continue to be the exclusive provider of international, inter-island and local public voice services over fixed networks and leased circuits for voice services in the Bahamas for a period of 24 months following the Share Sale, subject to the award of one fixed wireless licence to a third party which will allow the carriage of voice as from January 1, 2004.
In order to receive information on BTC and the privatisation opportunity, companies must demonstrate that they meet the basic criteria and will be required to sign a confidentiality agreement and pay a non-refundable registration fee of B$10,000.
Bidders who qualify for the purchase will be required to sign a confidentiality agreement. Companies whose principal business is the manufacture of telecommunications equipment are not eligible to participate in the bidding process directly or as a member of a consortium.
As the privatisation process moves forward, bidders are mindful that at the end of the process, the company may not be sold, as has been said by Prime Minister Perry Christie.
“In the very final analysis, the Government of the Bahamas is going to have to make a decision if it’s going to actually sell,” said Mr. Christie, who addressed a Progressive Liberal Party Think Tank several weeks ago. “We’re going through the launch, we’re going to see what will happen. But you can only sell if you’re going to get value.”
On September 4, the company moved a step closer to privatisation with an official name change from the Bahamas Telecommunications Corporation to the Bahamas Telecommunications Company.
Under its former structure as a public corporation, it would have been impossible for private interests to own any shares in the former BaTelCo.
But now, with the formation of a limited company, the government can sell shares to private shareholders. As a corporation, the government held complete ownership and control.
The Bahama Journal
