The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government and Cable & Wireless Communications (CWC) are hoping to conclude their ‘2 per cent’ deal over the Bahamas Telecommunications Company (BTC) by July 3, Tribune Business can reveal.

Franklyn Wilson, the Government’s lead negotiator, confirmed that CWC chief executive, Phil Bentley, was set to return to this nation then to finalise the deal, as he insisted that BTC majority ownership had been returned to the Bahamian people.

Responding to Tribune Business’s revelations that CWC’s financials for the year to end-March 2014 showed it as retaining a 51 per cent stake in BTC, Mr Wilson said this was because the agreement with the Government had yet to be finalised.

Arguing that CWC’s auditors could only account for “a definitive agreement” when assessing the year-end accounts, Mr Wilson - an accountant himself by profession - said he was unable to explain why the ‘BTC Foundation’ deal had not been included in the financial statements.

“No one is lying,” Mr Wilson said, in response to suggestions that CWC’s financial statements called into question the Government’s claims that it had regained 51 per cent majority control at BTC for the Bahamian people.

“Auditors don’t go on Memorandums of Understanding; they go on when definitive agreements are done.”

Pressed by Tribune Business on why CWC’s auditors, KPMG, one of the so-called ‘Big Four’, had failed to include the BTC deal at least as a ‘subsequent event’ to March 31, Mr Wilson replied: “I don’t know what the auditors do.

“There is no contradiction. Why the auditors from KPMG did not include that, I don’t know.”

The compromise, ‘face saving’ deal that allowed both sides’ to claim victory, saw CWC deposit 5,093,200 of its shares in BTC into a foundation where they will be held in trust for the Bahamian people.

These shares, which will be non-voting amount to just under a 2 per cent stake in BTC, meaning that CWC remains the largest shareholder with Board and management control.

But, as reported yesterday, CWC’s newly-released 2013-2014 accounts, approved by its Board of Directors and external auditors, list the company on page 151 as having 51 per cent “ownership of ordinary shares in BTC”.

This immediately calls into question assertions by Prime Minister Perry Christie, and Mr Wilson as the Government’s lead negotiator, that it successfully wrested ‘majority ownership’ back for the Bahamian people.

Mr Wilson, though, dismissed such notions yesterday, pointing out that both the Government and CWC, via Mr Bentley, were in ‘lock step’ with their public statements on the matter.

“There’s not one inch of difference between what I said and what he said,” Mr Wilson told Tribune Business. “The chief executive of CWC, and I as chair of the negotiating committee, have said exactly where it stands. Without coaching each other, we have said exactly the same thing.

“The Government said it has entered into a Memorandum of Understanding which, when executed in totality, will return 51 per cent to the Bahamian people.

“This is no spin. The Government of the Bahamas set out to gain majority control, the majority economic interest in BTC, for the Bahamian people. The MoU says once the definitive agreement’s signed, that will happen.

“The Government’s said that, the CWC chief has said that, the Prime Minister has said that, and I have said that. Financial analysts have said that 2 per cent is worth $25-$50 million. That’s not spin; that’s fact.”

Mr Wilson then revealed that Mr Bentley was due back in the Bahamas on July 3 to sign that definitive agreement, with both parties hoping their respective attorneys will have “dotted the ‘is’ and crossed the ‘ts’” by then.

Both sides had hoped to conclude the deal by end-March 2014 to coincide with CWC’s year-end, and the protracted closure indicates that the attorneys are taking extra care to ensure the language, and intent, of the agreements matches their respective clients’ needs.

“Let me say it to you categorically. The facts are as follows,” Mr Wilson told Tribune Business. “The Government and CWC have entered into a Memorandum of Understanding where the majority economic interest is to be returned to the people of the Commonwealth of the Bahamas once the definitive agreement is executed.

“That was announced by the Prime Minister and confirmed by the chief executive of CWC. Both sides hoped to conclude a definitive agreement by the end of March to coincide with the financial year-end for CWC, but that did not happen despite valiant efforts.

“Both sides are hopeful that when [Mr Bentley] comes back by July 3 , everything will be ready for execution and, at that point, everything announced in the Memorandum of Understanding (MoU) will come to fruition.

“Why the auditors did not include that as a subsequent event of note, I have no idea.”