06172016 business

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FRIDAY, JUNE 17, 2016

business@tribunemedia.net

Airport woes threaten 1.7m passenger boost By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Family Islands will be unable to capitalise on a projected 2.4 per cent annual growth rate in air passengers over the next 17 years unless $160 million is invested to bring their airports to “the highest possible” standards. A newly-released InterAmerican Development Bank (IDB) report warns that these islands cannot improve their tourism and economic competitiveness without a major overhaul of their 28 airports, which have “lacked investment for some time”. The report, which has been obtained by Tribune Business, outlines the proposed ‘Airport Infrastructure Programme’, which will be financed by a $35

Impact of 2.4% annual growth blunted for Out Isles $35m IDB project aims to unlock tourism potential Proposing NAD-type PPPs to get $160m invest million loan from the IDB to the Government. The project aims to identify the Family Island airports best-suited to a replication of the ‘NAD model’, which has overseen the transformation of

Lynden Pindling International Airport (LPIA) via a $409.5 million public-private partnership (PPP). Under that model, the Government has retained 100 per cent ownership of LPIA and all its assets, while handing over the airport’s daily operations and management to Nassau Airport Development Company (NAD), part of Vantage Airport Group. The IDB-financed project will assess 13 Family Island airports to determine whether they are suitable for a NAD-type PPP, and also develop the best structure for agreements between the Government and the private sector relating to their ownership and financing. The bulk of the monies, some $33 million, will be spent on financing the Government’s share of the investment re-

quired to upgrade the airports suitable for PPPs. “The 28 Family Island airports in the Bahamas have been in need of investment for some time and require a wide range of aviation and infrastructure upgrades to improve their regional and global integration,” the IDB report said. “The airports require maintenance and improvements in operating conditions, and also protection of the airside and its operation protected zones.” The IDB report continued: “It has been projected that in the next 20 years, the passenger demands on the Family Island airports would increase by 2.4 per cent annually to reach 1.7 million passengers by 2033. “For the Family Islands to capitalise on this opportunity, and to have a strong market See PG B4

Businessman supports Activists demand BEC GBPA ‘strong arming’ management deal’s disclosure By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

A VETERAN Freeport businessman believes the Government may have to “strong arm” the Grand Bahama Port Authority (GBPA) and its owners to revive the city’s moribund economy. Jeffrey Butler, the former Butler’s Food World operator, told Tribune Business that while he was not totally convinced that the Government’s Memorandum of Understanding (MoU) with the GBPA is the best route to take, “something has to be done”. “A lot of it is fine,” he said of the MoU. “They are strong-arming the Port Authority, but that may be necessary. The Port has been a dead issue for 12-13 years. “Something has to be done; I don’t know what the most diplomatic avenue is. They wanted the families [the Haywards and St Georges] out.” Freeport’s economy has

Butler: ‘We need new blood here’ Says families ‘don’t have a grip’ on Port, Freeport Disputes Gov’t assertion of Freeport ‘deficit’

generally been moribund since 2004, the year that Hurricanes Frances and Jeanne struck, and the Royal Oasis resort closed. That was followed by the passing of Edward St George, and the legal battle that erupted within first his estate, and then the wider GBPA ownership interests. Amid the legal wrangling, investment and new business flows to Freeport slowed to a trickle and, deSee PG B5

Pre-paid meter solution to BPL ‘cut-off trap’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net BAHAMAS Power & Light (BPL) has been urged to accelerate the roll-out of pre-paid electricity meters, an outspoken businessman arguing that it would help low income Bahamians avoid the “cut-off trap”. Dionisio D’Aguilar, who sat on the Bahamas Electricity Corporation (BEC) Board under the former Ingraham administration, said the reliance on post-paid meters was “onerous” for poor Bahamians. He told Tribune Business that these allowed households to run-up huge energy bills they had no ability to pay, resulting in BEC (now BPL) cutting them off for non-payment. And, given the relatively high cost of electricity, coupled with high unemployment and the struggling economy, Mr D’Aguilar said many low income Bahamians were unable to afford what was necessary for their supply to be restored. This resulted in families being cut-off for months, even years, and the Superwash president said pre-paid meters would instead enable them to manage their energy consumption to the point where they would only use See PG B4

Poor Bahamians run up big bills, can’t get back on Ex-BEC director sees ‘conservation’ solution New operator indicates open to new technology

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By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net ENVIRONMENTAL activists are seeking a Supreme Court Order that will force the Government to disclose the management agreement signed with PowerSecure International for Bahamas Power & Light (BPL). The Coalition to Protect Clifton Bay, in a June 6, 2016, summons, wants the court to also Order the production of numerous documents related to BPL/BEC’s oil pollution mitigation efforts at Clifton Pier, and contracts with various environmental consultants. However, top of the Coalition’s list is the February 9, 2016, management services agreement between the Government and PowerSecure “for the management, operational control and responsibility for all electricity generation, transmission, distribution, procurement, and the safe and reliable operation of the BEC facilities”. Neither that agreement, nor PowerSecure’s business plan for BPL, the Bahamas Electricity Corporation’s (BEC) newly-formed operating subsidiary, have been disclosed as yet to the Bahamian public and business

Clifton Coalition seeks Supreme Court Order Implies Gov’t stalling on document discovery Wants host of pollution mitigation contracts divulged community. BPL had called a press conference to discuss its business plan, but this was cancelled just days before its proposal for a ‘base rate’ increase which the Christie government subsequently rejected - was leaked out. Legal documents obtained by Tribune Business suggest that the Coalition and its attorneys, Callenders & Co, filed the June 6 summons after becoming frustrated at what they perceived as ‘stalling’ by the Government over document discovery. Deidre Henfield, a Callenders & Co legal assistant, alleged that the Coalition filed a May 3, 2016, notice asking to inspect, and obtain copies See PG B5

CABLE BAHAMAS HEAD OFFICE

Cable readies $30m pref share offering Proceeds to ‘fund expansion’ in Bahamas, US Broken in $20m B$, $10m US components Will likely assist second mobile operator roll-out By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net CABLE Bahamas is again preparing to tap the Bahamian capital markets for a further $30 million in preference share financing, which will help fund the roll-out of this nation’s second mobile provider. The BISX-listed communications provider has issued term sheets to select institutional investors and their advisers, in a bid to both whet their appetite and inform them to keep liquid capital on hand, for an offering it wants to launch in late June. Tribune Business can reveal that the proposed $30 million issue is broken down into tranches, with investors set to be offered $20 million worth of Bahamian dollar-denominated preference shares, while the $10 million balance will be in US dollars. The term sheets, which have been seen by this newspaper, reveal that the $20 million Series 11 tranche will be used to finance both Cable Bahamas’ operating expenses and capital investments. “The proceeds will be used to fund the company’s capital expenditures and operating expenses, as well as to facilitate further expansion in both the Bahamian and US markets,” the Series 11 term sheet reads. The term sheet for the $10 million US dollar tranche, to be called Series 12, states that the funds will only “be used to meet operational funding requirements”. The offering is private, and Bahamian public investors should not seek to participate. Cable Bahamas’ latest capital call is thus See PG B4


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