By NEIL HARTNELL
Tribune Business Editor
The chair of the Bahamas Telecommunications Company’s (BTC) privatisation committee yesterday expressed confidence that a Parliamentary probe would find the sale was “the best deal that could be done”, provided its inquiry was conducted properly.
Julian Francis, who was also BTC’s chairman when the former Ingraham administration sold a 51 per cent majority stake to Cable & Wireless Communications (CWC), said he had “no doubt” that all parties to the deal had conducted themselves properly.
The former Central Bank governor added that the privatisation was “done in an entirely correct way”, and said it was unlikely that any improprieties would have escaped his attention.
Emphasising that he welcomed the House of Assembly’s decision to form a select committee to investigate BTC’s privatisation, Mr Francis said he was prepared to “fully co-operate” with its work.
He added, though, that the Christie administration had created questions about its “seriousness” and intent by delaying the select committee’s formation for so long.
And, now that it had been formed, Mr Francis suggested it would be perceived as “a political move” so close to a general election.
Still, dismissing suggestions that something untoward had occurred over BTC’s privatisation, Mr Francis told Tribune Business: “Once a proper review is done, they will come to the conclusion this was the best deal that could have been done, and that it was done in an entirely correct way.
“I have no doubt about that whatsoever, unless there’s something I’m not aware of, but I rather doubt that.”
The then-opposition Progressive Liberal Party (PLP) focused on the BTC privatisation as a major element of its 2012 general election campaign, tapping into deep-rooted Bahamian nationalism with slogans such as ‘keep Bahamian industries in Bahamian hands’.
Both in opposition, and following their subsequent election to government, PLP ministers and MPs have continually attacked the BTC privatisation via allegations of ‘finder’s fees’; the $1.5 million in bonuses shared between 15 BTC executives; and concerns over how CWC became the buyer when it did not enter the original process.
Mr Francis yesterday suggested that the Christie administration should have acted earlier to put such claims and innuendo to rest, as it created an impression of wrongdoing that was unwarranted.
“They should have done it four years ago,” Mr Francis said of the BTC select committee’s formation this week. “When it came up again two years ago, I just felt the Government should have gone ahead and done it, instead of always talking about it.
“Now, it just smacks almost of a kind of political move.”
Free National Movement (FNM) MPs argued in Parliament on Monday that the select committee’s formation was little more than an attempt by the Government to distract the Bahamian public from the many more serious issues affecting the country just prior to the upcoming general election.
The timing certainly leaves many observers with that impression, and Mr Francis said the select committee needed to hire professional accountants and corporate advisers to help it understand all the BTC privatisation’s nuances.
“It seems to me that if they want a proper review done, they should engage a professional auditor to do it, so they have a complete analysis and understanding of the whole thing,” he told Tribune Business.
“ Hopefully, now we have the committee convened they can get on with it. It would be a good thing for this matter to be put to rest finally, and if the Government is serious about it and wants to do it properly and the review goes ahead, I would for my part be entirely happy to co-operate with the committee’s work.”
Mr Francis added: “The sooner they [the select committee] get it done, the better. It will take time as it’s a fairly complex transaction, since it involved a great deal of work and there are thousands of documents to be reviewed.
“For my part, I’m absolutely happy to co-operate fully with the work of the committee. No problem. I’m very happy to be fully co-operative and help however I can with the work the committee needs.”
The calibre of persons and advisers directly involved in the BTC privatisation process, and negotiations for the company’s sale, would likely have guarded against any of the suggested improprieties.
The privatisation committee’s deputy chairman was the late T. B. Donaldson, chairman of Commonwealth Bank and, like Mr Francis, a former Central Bank governor. The committee’s work was also overseen, and approved by, a privatisation advisory committee set up by the former Ingraham government.
Apart from these layers of safeguards, the advisers engaged by the former administration included the likes of Citibank and KPMG, both highly-regarded financial services and accounting brands.
The Christie administration subsequently retained KPMG to advise on the Bahamas Electricity Corporation (BEC) and energy sector restructuring, and its National Health Insurance (NHI) scheme.
And it has also retained the UK law firm, Charles Russell Speechlys, as the Government’s British legal adviser - the same law firm that, too, advised on the BTC privatisation process.
While the $1.5 million worth of bonuses paid to the BTC executives have been described as ‘hush money’ by PLP MPs, and designed to ‘buy their silence’ over the privatisation, those involved with the process have described this as appropriate compensation given the extra ‘man hours’ and work involved.
Mr Francis also previously explained to Tribune Business that the Government began negotiating with CWC after all efforts to negotiate an acceptable deal with the bidders who entered the process proved fruitful.
He said negotiations with the leading bidder to emerge, the J P Morgan/Vodafone combination, broke down after the latter - which would have been BTC’s operating partner - refused to ‘put skin in the game’ by taking an equity stake in the bid.