BY KEVA LIGHTBOURNE Guardian Senior Reporter email@example.com
Cable and Wireless has said its main focus will be on preparing the Bahamas Telecommunications Company for competition.
“We intend to improve its networks, introduce new services and move it to a cost base able to sustain the business in a competitive environment. In partnering with the Government of The Bahamas, we believe that we can deliver a world-class telecoms capability to the people and businesses of The Bahamas,”said Cable and Wireless in a statement released yesterday.
CWC and the government on Tuesday signed an agreement that will finally privatize BTC and hand over 51 percent share ownership of the company to the London-based entity.
“We are pleased to have BTC join the Cable and Wireless Communications group. It is a business with strong prospects, well positioned in one of the Caribbean region’s largest economies. It will form a key part of our Caribbean business, benefitting from our regional platform and scale, while maintaining its Bahamian character,”said C&W.
BTC is the exclusive mobile operator in The Bahamas, as well as a leading provider of fixed-line and broadband services. It will form a key plank of CWC’s Caribbean business, LIME, the leading full service telecommunications provider in the region.
CWC claims it has developed a business and restructuring plan for BTC to improve and expand its services and increase its customer focus.
CWC explained that the acquisition would be funded from its existing cash balances and debt facilities. The transaction is expected to be earnings and cash flow accretive excluding restructuring costs.
CWC reported that the key terms of the sale and purchase agreement and the shareholders’agreement entered into with government in respect to BTC are consistent with the memorandum of understanding announced on 2 December and include:
-CWC will acquire 51 percent of the shares in BTC, including management control of the business, for US $210 million
-The purchase price is based on BTC having net cash of B$5 million on closing, and is subject to standard post-completion adjustments for actual net cash and working capital balances at closing.
-The liberalization process for the mobile sector will commence no sooner than three years after privatization.
-A workforce restructuring program after privatization will be undertaken on a voluntary basis and is planned to be implemented within the first year after completion.
Prime Minister Hubert Ingraham has said ……
Both BTC union’s the Bahamas Communications and Public Officers Union and the Bahamas Communications and Public Managers Union are opposing the deal.