The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Grand Bahama Power Company’s owner has confirmed its sale to the Government has yet to be finalised as an ex-prime minister joined the Opposition’s leader in calling for Bahamian investors to be offered shares in the utility once any deal closes.

Dr Hubert Minnis and Michael Pintard, for once, both appeared to be united as they each separately urged the Government not to retain 100 percent of GB Power but, instead, steadily reduce its stake post-acquisition by issuing shares to Bahamian institutional and retail investors as a means to boost wealth creation and local ownership of the country’s economy.

However, before any initial public offering (IPO) can take place, the Davis administration first has to close its purchase of GB Power with the Canadian utility giant, Emera. The latter, in a late Monday night reply to Tribune Business inquiries after press deadline, revealed that the Government has yet to seal the deal although negotiations between the two parties remain active.

“Emera confirms constructive discussions remain ongoing with the Government of The Bahamas regarding an acquisition of the Grand Bahama Power Company,” a spokesperson confirmed in an e-mailed response. “No final agreement has been reached at this time.” While the two sides have already signed a memorandum of understanding (MoU), Emera said the Government’s proposed GB Power purchase remained only an “option” and was just one of the routes discussions could take.

Emera’s confirmation that no sale has yet been finalised is likely to raise questions during today’s House of Assembly debate on two resolutions, seeking Parliament’s approval for the Government to guarantee $280m worth of borrowings to finance GB Power’s purchase and working capital for the utility, over why the Davis administration is seeking to put these arrangements in place with such seeming haste and urgency given that negotiations are still ongoing.

The Government has yet to disclose its “game plan”, and the commercial and economic rationale, for acquiring GB Power and adding more than a quarter-of-a-billion dollars to The Bahamas’ $12bn-plus national debt other than implying that Grand Bahama businesses and households will see a reduction in energy bills and costs following the acquisition. It has also yet to show how its valuation of GB Power was derived, given that $200m of the $280m has been earmarked for covering purchase costs.

Emera’s financials for the 12 months to year-end 2025 show that GB Power generated a $10m Canadian dollar contribution to the utility giant’s “consolidated adjusted net income” for the period - a figure that was slightly down on the prior year’s $11m. Using the current exchange rate, that $10m Canadian dollars translates into about US $7.3m.

Those profits were generated from $162m Canadian dollars worth of revenue, which represented a 16.5 percent year-over-year increase compared to 2024’s $139m Canadian dollar top-line. The increase is likely due to increased economic activity among GB Power’s 20,000-strong customer base, with Carnival’s $600m Celebration Key destination having opened last July. The exchange rate conversion means GB Power generated $118.26m worth of revenues in US dollars last year.

The value of the Grand Bahama-based electricity provider’s physical assets, namely property, plant and equipment, narrowed slightly last year from $371m Canadian dollars at year-end 2024 to $361m Canadian dollars some 12 months later.

To give an idea of what the Government is potentially acquiring, Emera said: “With $378m US dollars of assets, and approximately 20,000 customers, GB Power owns 98 mega watts (MW) of oil-fired generation, approximately 100 kilometres of transmission facilities and 1,000 kilometres of distribution facilities. GB Power’s approved regulatory return on rate base is 8.52 per cent.”

Dr Minnis, meanwhile, was united with his successor as Free National Movement (FNM) leader in calling for the Government to steadily, and carefully, sell down its ownership stake in GB Power - if a transaction is sealed - by offering shares to Bahamian investors via a series of IPOs.

He urged that any divestment by the Government adopt a “bottom up” approach, where small individual retail investors are given priority and receive 100 percent of the share amounts they subscribe for, so as to spread wealth creation to as many Bahamians as possible. And, in another dig at the Government’s existing reforms, and the structure of Bahamas Grid Company, the New Providence electricity grid owner, he urged that any GB Power IPO not be “for a select or chosen few”.

“I’d have to have Bahamians involved,” Dr Minnis, now running as an independent candidate for his Killarney seat in the upcoming general election, said. “That’s the thing. Bahamians have to be involved. A certain percentage [of shares] for the private sector, a certain percentage for the public, and a certain percentage for the Government.

‘That would be my view, so that Bahamians be involved. It cannot be a select or chosen few. Wealth and opportunity has to be spread among all. Purchasing and holding it for Bahamians, I don’t have a problem with that…and I’m talking about allowing everyone to have an opportunity.” Bahamas Grid Company’s $30m in equity was obtained via a private offering open just to wealthy, deep-pocketed institutions and individuals, but Dr Minnis argued that any GB Power IPO focus on small, individual investors.

“It should be from the bottom up rather than the top down,” he added. “It creates a bit more work from the bottom up, but at the same time it’s giving every Bahamian an opportunity, and every Bahamian a chance, to be a part of wealth in The Bahamas that is not limited to a few like Bahamas Grid Company with Pike Electrical and the select few. The Government has a responsibility to look after every Bahamian rather than a select few.”

Dr Minnis said the Government could follow the formula his administration employed with the Nassau Cruise Port for any eventual GB Power offering. For the former, an investment fund called the Bahamas Investment Fund was created to hold a 49 percent equity ownership stake in the cruise port, and Bahamian investors acquired their interest by purchasing shares in the Fund.

And the former prime minister added that, much like the Nassau Cruise Port IPO, individual investors could be given access to small “soft loans” of around $1,000 to enable them to purchase shares in GB Power with these debts then repaid from dividend payments received from the utility. “They don’t have to come up with anything but now have an ownership stake,” Dr Minnis added.

“I don’t think the Bahamian public would disagree with that type of formula. You are then doing something to benefit every Bahamian in this county, and that’s the way the Government should start thinking. I don’t think the Government should own it. The Government should just be holding it for the Bahamian populace and sell down its interest.”

Dr Minnis said it would also be a worthy gesture and benefit for Grand Bahama residents who have had to absorb relatively high energy costs for years. “You are saying: ‘I have recognised your pain, I have recognised your suffering, and I am going to create an opportunity for you to have ownership and receive dividends,” he added.

Mr Pintard, meanwhile, has voiced similar sentiments. “Why are Bahamians being shut out of this deal?” he asked. Why wasn’t a structure explored that allows citizens to own a stake, share in the future of their island, and build wealth? Instead, all the risk is being placed on taxpayers with no opportunity for citizens to participate.”

Grand Bahama businesses, meanwhile, continue to voice scepticism about what the Government’s proposed GB Power purchase will mean for energy costs and reliability on the island. “If we’re going to come under the auspices of what goes on in Nassau, it’s a bit scary,” one said. “I’m sure Emera will be delighted. I’m sure they will be happy to be out.”

And a financial observer, speaking on condition of anonymity, said they were “shocked and stunned” that the Government was seeking to increase the national debt by almost $300m through pursuing GB Power’s acquisition. Emera, they added, had seemingly not been seeking to sell or exit, which meant it had likely been “squeezed” by the Government into doing so.

The GB Power purchase which, in effect, is a nationalisation of Grand Bahama’s energy supplier, is also the exact opposite direction that the Government has taken in outsourcing Bahamas Power & Light’s (BPL) New Providence baseload generation and electricity grid to the private sector,

“GB Power should be the least of their worries,” the source said. “It’s a functioning utility. It would be different if it was in trouble or a bad performer, but there’s no urgency other than there’s an election coming up and they want to make a splash. I’m eager to find out what the rationale is going to be. This [Emera’s confirmation the sale has yet to close] makes this $280m exercise more curious because there’s no need to do this right now.

“No one is clamouring for this change. I know quite a few people in Grand Bahama and not one wants the Government to have a greater role. And we haven’t seen the game plan for GB Power. Are we taking on the liabilities? What are we actually purchasing? This has been driven by the Government from day one but there’s no need for the Government to be taking this on.

“You have enough Bahamian capital out there. Let them buy it, let the regulators regulate, otherwise you are setting yourself up for disaster and you will have another BPL and the same problems that BPL has but now in Grand Bahama.”