By NEIL HARTNELL
Tribune Business Editor
The Bahamas Telecommunications Company (BTC) and its fibre optic cables will remain outside the regional joint venture its majority shareholder has entered into with Columbus Networks, Tribune Business was told yesterday.
Geoff Houston, BTC’s chief executive, said that “for the moment BTC sits outside the scope of that joint venture, so all our sub-sea cable assets remain within the ownership of BTC.
“But, going forward, we’ll look to see if we can leverage some benefits for BTC, whether that be sales opportunities or opportunities to co-operate.
“We’ll look to co-operate where we can, so long as added value is provided for BTC customers, and we can see some value for BTC’s business as well.”
BTC’s fibre optic cables, which link this nation to the world’s communications markets via links to the US and Haiti, would be especially valuable to the joint venture between Cable & Wireless Communications (CWC) and Columbus.
This is due to their being the first point of Caribbean connectivity to the US, due to the Bahamas’ proximity to Florida, but moving those multi-million dollar cable assets out of BTC’s ownership would likely arouse protest from a Christie administration already seeking to regain majority control at the newly-privatised carrier.
The CWC tie-up with Columbus, at one point the controlling shareholder in Cable Bahamas before its exit, aims to provide wholesale bandwidth capacity and connectivity to other telecommunications carriers and companies in the Pan-American region.
Both companies operate sub-sea cable networks in the Caribbean and Central American region, and the joint venture will have a network platform of approximately 42,000 kilometres with connectivity to 42 countries.
Columbus will have a 72.5 per cent majority equity stake and management control of the joint venture, with CWC holding the minority stake and necessary protections.
The alliance will take effect in two years’ time, when Columbus and CWC contribute their sub-sea and related assets into the joint venture company, subject to obtaining regulatory approvals and certain other conditions being met.
Until then, Columbus and CWC will retain complete ownership and control of their respective existing networks in the region.
CWC’s chief executive, Tony Rice, said: “In a world in which demand for data is growing exponentially, bandwidth is absolutely crucial, and for this reason we are delighted to be partnering with Columbus, an organisation with vast experience and capability, and an excellent sub-sea network.
“This joint venture aims to provide us with access to a secure, long-term supply of international data capacity to support our retail businesses in the pan-America region.
“It will also enable us to better monetise the excess capacity we have on our networks, and in so doing offer high capacity and resilient solutions to our customers. The alliance will put both CWC and Columbus in a strong position in the growing market for international wholesale capacity.”
CWC’s assets subject to the joint venture arrangement had a gross asset value of $108.2 million, and recorded a loss before tax of $0.9 million in the year to 31 March, 2013.
Columbus’s assets subject to the joint venture arrangement had a gross asset value of $304.6 million and recorded a profit before tax of US$29.3 million in the year to 31 December, 2012.