The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

OPPONENTS of the GB Power buy-out yesterday warned the utility’s owner: “Don’t count your Depository Receipt chickens before they’re hatched” despite investor approval for the deal.

Fred Smith QC, the Callenders & Co attorney and partner, told Tribune Business that this was “the beginning of the fight, not the end”, and pledged to file his Judicial Review challenging the $35 million deal with the Supreme Court next week. A similar message was delivered by Pastor Eddie Victor, head of the Coalition of Concerned Citizens (CCC), who promised to step up a lobbying campaign urging the Government not to approve the buy-out by Canadian utility, Emera.

The duo spoke out after 89 per cent of Bahamian shareholders in ICD Utilities, the BISX-listed vehicle that holds a 50 per cent equity stake in GB Power, were said to have voted in favour of accepting Emera’s offer.

While the outcome of Wednesday night’s annual and extraordinary shareholders’ meeting gives the impression that the buy-out is a ‘done deal’, both Mr Smith and Mr Victor argued that Government approvals and the courts still remain as hurdles.

“I want to let Emera know this is the beginning of the fight, not the end, and they shouldn’t count their Depository Receipt chickens before they’re hatched,” Mr Smith told Tribune Business.

“The next step is to continue to agitate publicly to urge the Government to protect those Bahamian shareholders who did not vote to accept Emera’s proposal, and who wish to continue to own shares - directly or indirectly - in GB Power Company, not Emera International.

“The Bahamas Investment Authority (BIA) approval, which they waved around as some kind of legitimate permit from the Government, as we all know has no basis in law and it was a regulatory snow job because the BIA doesn’t exist in law.”

A challenge to the validity of the BIA approval is likely to prove central to Mr Smith’s promised Judicial Review, and the QC also pointed out that the Central Bank only gave an ‘approval in principle’ on the exchange control aspect.

Disclosing that he “fully expected” most of the 19.6 per cent Bahamian minority shareholders to vote in favour of the buy-out, Mr Smith said final approvals from the National Economic Council (NEC) and Central Bank remained outstanding.

“We’re still looking at challenging the conditional approvals that were issued via Judicial Review, and probably will file it next week,” he added. “I hope that the Government will then respect that there is a process before the courts and no final approvals will be given before the matter is determined, and that they respect the rule of law.”

Pastor Victor was in a similar mood, telling Tribune Business: “The fight doesn’t stop; it intensifies. We’re going to fight and press the Government and its agencies in the next few days. The thing now is what is the Government going to say and do. We’re going to be at it.”

Bahamian shareholders also expressed disquiet over the structure of Wednesday night’s meeting and its timing, given that it was held at 5pm at Freeport’s Pelican Bay resort.

The lack of parking at the resort meant a number of minority investors, and their proxies, were delayed in arriving, and the vote on whether to accept the Emera offer was taken right at the start of the meeting - around 5.15pm-5.20pm. This resulted in some shareholders barely arriving in time to vote, while others missed it.

Carey Leonard, the Callenders & Co attorney and partner of Mr Smith, said he was one of those forced to park around one-quarter of a mile away near the police station and only just arrived in time for the vote.

“When I got in, the chairman [Scott Balfour, also Emera’s chief executive] said: ‘Welcome, we’re voting’,” Mr Leonard recalled. “I replied: ‘I haven’t had a chance to speak’. He repeated that they were voting, and I said I should have had a chance to speak.

“I said that I wanted it in the meeting minutes that this was wrong, and he said: ‘Would you like to speak?’ So I said my five cents.”

Pastor Victor, too, said other minority shareholders and persons at the meeting on the Coalition’s behalf expressed similar complaints to Mr Leonard, suggesting the time, parking issues and agenda had been structured to ensure the buy-out was approved.

“They made absolutely sure they got this thing off,” Mr Leonard told Tribune Business. “By 5.15 pm they were already voting. They really pushed it through very quickly, and must have known people were having trouble parking. There were four or five of us at the entrance.”