The strategic partner for the sale of the Bahamas Telecommunications Company must have at least $300 million “in capital or funds under management” and must pay the government a $10,000 non-refundable registration fee in order to qualify for the privatisation bidding process to be launched tomorrow.
After years of controversy surrounding the sale of the former corporation and the spending of some $150 million to prepare BTC for privatisation, the government is ready to kickstart the bidding, with several Bahamians lined up to submit their bids for the purchase of 49 percent of the shares.
The cut off date for the interested parties to make their intentions known to the government is December 6 and the final date for the submission of preliminary bids is January 10.
An advertisement that has been prepared by the Financial Secretary in the Ministry of Finance and scheduled to be run in local papers tomorrow states that qualifiers for the bidding must either demonstrate revenues from telecommunications services in excess of $300 million or must have in excess of $300 million under management.
But Prime Minister Perry Christie has indicated that when all is said and done, the sale may not actually go through.
“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 two 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.”
True to the government’s word that it will invite Bahamians to participate in the process, the advertisement welcomes locals to apply.
“Applications by consortia that include Bahamian citizens or Bahamian registered companies are encouraged to participate,” the ad said. “All applications shall be treated equally.”
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.
At the time of the announcement, BTC Chairman Reno Brown said the vesting of the company marks the first crucial and very necessary step in the privatisation process.
Officials of BTC expect that the bidding process would be the next “very crucial step” in privatising the company.
As of June 30,2002 , the company had 125,400 fixed line subscribers, representing a fixed line penetration rate of 41 percent.
The ad states that 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 sale.
The company will also continue to be the exclusive provider of cellular services in the Bahamas for a period of 12 months following the sale.
For the financial year ended December 31, 2001 , BaTelCo’s revenues totalled $226 million and its earnings before interest, depreciation and amortisation were $100 million. The corporation’s net assets as of December 31, 2001 were $287 million.
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.
The advertisement further advises that the sale will be conducted in a two phase process with the first phase culminating with the submission of non-binding preliminary bids. Short-listed parties will be invited to participate in the second phase which will lead to the submission of final bids.
Officials announced the launch of the bidding process at the Cabinet Office Tuesday afternoon.
By Candia Dames, The Bahama Journal
