The Bahamatel Consortium managed to edge out its competitors to become the preferred bidder to purchase 49 percent of the shares in The Bahamas Telecommunications Company (BTC), but there are no guarantees that the group will become the much-talked about strategic partner, State Minister for Finance James Smith said last night.
The Tenders Commission revealed its decision yesterday, nearly one year after the government announced that it will be accepting bids for the purchase of the shares.
The next step in the process involves the preferred bidder and the Commission being locked away in a 30-day exclusive negotiation process.
The company initially has a month to win over members of the Commission. But if it doesn’t, then the Commission has the option of either extending the exclusive negotiations with the bidder or starting negotiations with the preferred bidder who is ranked next in line.
But officials did not reveal who the runner-up bidder is.
Tom Bain, who heads the Bahamatel Consortium, said from his London office this morning, ” I am extremely optimistic that with this much information and this much work done, the two sides will be able to hammer out an agreement to the satisfaction of both.”
His group beat out Blue Telecommunications and TransWorld (Bahamas) Limited.
But officials have some reservations about certain commercial terms, according to the statement that they released.
What the Commission also pointed out was that although Bahamatel Consortium is the preferred bidder, it does not mean that its bid is automatically accepted.
Minister Smith, who is responsible for privatization issues, commented on the move shortly after it was announced.
“They are closest in the sense that they have been selected out of the others that had tried to take over the 49 percent,” he said, referring to Bahamatel Consortium. “However, even the preferred group will still have to meet certain criteria that the government is likely to put in place through the Tenders Commission who will be doing the negotiations.”
Minister Smith said that while the BTC privatization process is progressing well, it still has to pass a critical stage.
But he added, “I don’t know if this thing would ever give you that kind of sense of completion because privatization, as you know, is merely one element of liberalization of the telecommunications sector, meaning that at the end of the day, the idea is to have a more efficient sector, much more cost efficient, and on the leading edge of technology.
“So, this is the beginning of a process, rather than the ending of one.”
Mr. Bain said that a decision by the government to turn back at this point would send all the wrong messages to the international community, the local community and would adversely affect “the evolution of the Bahamian economy,”
“I would argue that it is very important for the government to move forward with it, but I applaud their sense of caution in covering all the issues before they proceed,” he said.
Mr. Bain said that the process so far has cost his group in excess of $1 million
He said his due diligence team was extensive and included accounting firms and insurance specialists from The United Kingdom, Canada and the United States as well as local counsel.
“A team of that size, of that skill set and complexity is inevitably expensive over a period of ten months,” he said.
He added that Bahamatel Consortium’s first priority is to concentrate on BTC’s employees.
“We have enjoyed and been impressed with our interactions with the employees… We feel they are just dying to get this behind them and move into the new era where they can provide better products and services to their customers,” he said.
He added that the consortium believed BTC staff was frustrated and keen to make improvements.
“We want to focus first on making sure they feel empowered to make those changes which of course will be to the benefit of all consumers in the country,”
Eight companies qualified to submit bids for the privatization of BTC with only four submitting preliminary bids.
By Julian Reid, The Bahama Journal
