The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Cable Bahamas is planning to imminently tap the capital markets with another multi-million dollar preference share issue, Tribune Business can reveal.

Multiple sources, speaking on condition of anonymity, confirmed that the BISX-listed communications operator was seeking to raise a sum “more than $60 million, but less than $100 million”.

Tribune Business understands that the total amount being sought is likely to fall in the middle of that range, near $80 million, with the company potentially set to issue a press release confirming the transaction details this week.

RoyalFidelity Merchant Bank & Trust, which will act as lead arranger and placement agent for the preference share issue, has already been in contact with key institutional investors - and their advisors - to determine likely Bahamian capital market interest in the offering.

“They’ve been putting out feelers this past week, seeing whether we have interest,” one source, speaking on condition of anonymity, told Tribune Business.

“They’re doing a little test to see what the appetite is.”

Cable Bahamas certainly could have a major reason to make a significant capital call on investors were it to win the bidding for the second Bahamian mobile communications licence.

Under the terms of the Government’s Request for Proposal (RFP), the winning bidder has various targets for service delivery/network rollout that it must meet over a 36-month period.

To do so, it will likely require an investment of around $200-$250 million. However, sources familiar with the situation emphasised that the second cellular licence is not at the forefront of Cable Bahamas’ thinking in its latest financing round.

It will not know whether it has won the bid for several months yet, and one source described the upcoming preference share issue as “part of the financing requirements for the business”.

While the proceeds may well be used to part-finance any mobile infrastructure requirements, Cable Bahamas also has its ongoing Bahamian business - plus $100 million worth of Florida acquisitions - to operate and run.

Anthony Butler, Cable Bahamas’ president and chief executive, declined to comment when contacted by Tribune Business. As a publicly traded company, the communications operator must fulfill all BISX and Securities Commission requirements before making a formal announcement to the market.

Tribune Business sources indicated that the latest preference share issue would be slightly smaller than Cable Bahamas’ $100 million offering last year, which ultimately raised $114.5 million - a sum that was a record for the largest private debt offering in this nation.

In common with that issue, Tribune Business understands that the latest preference share offering will also contain Bahamian dollar and US dollar denominated components.

It is unclear whether it will follow Cable Bahamas’ previous five preference share offerings in terms of being listed on BISX, of if the proceeds will be part-used to refinance some of those previous issues at lower interest (debt servicing) costs.