The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian investor group featuring an ex-Olympic swimmer, former FNM senator and grand-daughter of Super Value’s owner are aiming to raise more than $400m in initial capital to finance the acquisition of the Grand Bahama Port Authority (GBPA) and its key economic assets.

Nicholas Rees, chairman and co-founder of Kanoo, the digital payments provider, has teamed with attorney John Bostwick and Paige Waugh, grand-daughter of Rupert Roberts, to form Born Free Capital as a “100 percent Bahamian-owned acquisition vehicle” that is seeking to purchase both the GBPA, and its quasi-governmental and regulatory powers, and the 50 percent Freeport Harbour Company and DevCO interests held by Port Group Ltd.

Details of Born Free Capital’s plans are contained in a November 1, 2025, “investment presentation” which has been obtained by Tribune Business. The purchase strategy is divided into two phases, dubbed ‘Project Lionfish’ and ‘Project Grouper’ respectively, with the former focused solely on acquiring 100 percent of Grand Bahama Development Company (DevCO).

This first stage would seemingly involve purchasing the 50 percent DevCO stake held by Hutchison Whampoa’s real estate arm, as well as the matching equity interest held by Port Group Ltd, which is the entity into which all the GBPA’s productive economic assets have been transferred to. Other Hutchison interests, including the Freeport Harbour Company, would not be touched.

Born Free Capital’s presentation values the whole of DevCO, and its remaining 75,000 acres of undeveloped land, at between $120m and $150m. DevCO’s acquisition is branded “crucial to unlocking” Freeport’s potential as a special economic zone (SEZ) since its 75,000 acres will form the location of a new “smart city by the sea” capable of housing the 250,000-plus people needed to staff and drive the free trade zone.

The presentation, which has been issued to solicit potential investors and the necessary financing to make Born Free Capital’s plans a reality, also discloses that it will hire major maritime, infrastructure and coastal engineering and construction firms to develop “diked systems” that will protect Freeport and the “new smart city” from future Hurricane Dorian-style storms surges as well as climate change-related sea level rise.

The second phase, ‘Project Grouper’, involves the acquisition of both the GBPA and Port Group Ltd through the purchase of their ultimate parent company, Cayman-domiciled Intercontinental Diversified Corporation (IDC), which is valued at $270m. This would include purchasing the 50 percent equity ownership interest in Freeport Harbour Company, plus the entire 100 percent of Grand Bahama Utility Company, which is Freeport’s water supplier.

It would also involve acquiring Freeport Commercial and Industrial, the land-holding company that owns 8,000 acres of real estate targeted for commercial and industrial development, plus Carrick Ltd, which is the ultimate immediate parent for a 50 percent stake in Sanitation Services Company. Port Group Ltd’s minority Grand Bahama Shipyard interest would also be involved in the proposed deal.

To finance its ambitious acquisition, Born Free Capital’s investment presentation reveals it is seeking an initial $402.8m in financing through a mix of debt and equity capital. The $42.8m worth of equity is broken down into $5m injected by its “founders’, with a further $37.8m to be raised from both “pre-seed” and “seed investors” in two separate rounds.

The $360m debt, described as “bridge” or “mezzanine” financing, will be raised through the issuance of two preference share classes that will pay interest returns to investors of 10 percent over a two-year period. At the end of that 24-month period, Born Free Capital is offering to either convert those preference shares to $441m worth of equity shares in itself or refinance them via long-term debt worth the same amount and paying 6.5 percent interest.

The presentation also reveals that Born Free Capital is planning to give Bahamian investors, as well as GBPA licensees, an equity ownership interest in the purchase by issuing 20m common shares, priced at $3.25 per share, in a $65m initial public offering (IPO) although a date and timeline for this was not provided.

Two tranches of four million shares, worth a collective $13m each, would be allocated to a fund created for GBPA licensees and the Government’s National Investment Fund, respectively, with the remaining 12m - valued at a collective $39m - would be available for purchase by Bahamian private investors.

Collectively, the Government, licensees and Bahamian investors would end up owning 5 percent of Born Free Capital’s equity, with the largest interests held by its founders (25 percent); and seed and converted preference share investors (30 percent and 35 percent) if all goes to plan.

Born Free Capital’s principals declined to comment when contacted by Tribune Business, citing the existence of non-disclosure agreements that they have signed up to. However, this newspaper understands that it has been negotiating with the GBPA and its two owners, the Hayward and St George families, for some time - and possibly as long as two years.

Information contained in the presentation makes clear that Born Free Capital and its principals have been conducting due diligence on both the GBPA, Port Group Ltd and their underlying operating companies, and have received financial information on what are private companies. While much work remains to be done, this newspaper understands that negotiations are continuing and the bid to raise capital is very much active.

“They want to create a nationalistic project that empowers Bahamians, eliminates the red tape, opens up the doors for Bahamians to be empowered, have access to land, access to capital and greater ownership in their country,” one source, speaking on condition of anonymity, said of Born Free Capital’s plans. “They have created something beautiful. It’s a matter of them pushing through to the end and gaining support.”

The revelation of a fully Bahamian-owned group’s GBPA and Port Group Ltd bid comes amid the wait for the three-strong arbitration panel to deliver its verdict on the Government’s accusation that Freeport’s quasi-governmental regulator owes the Public Treasury some $357m. It is claiming this figure represents how much the Government’s public expenditure in the Port area has exceeded the tax revenues received from the latter, and is demanding compensation as allegedly provided for by the Hawksbill Creek Agreement.

Born Free Capital’s bid, if the necessary financing can be raised and a deal closed, would satisfy calls for greater Bahamian involvement in the GBPA and also meet the Davis administration’s demands for a change in ownership and the exit of the Hayward and St George families. However, even if it seals the purchase with the two families, any acquisition would also require the Government’s blessing and approval.

It is understood that a decision from the three-person arbitration panel, chaired by Sir Anthony Smellie KC, former chief justice of the Cayman Islands, and the two UK law lords - Lord Neuberger of Abbotsbury and Dame Elizabeth Gloster - is expected within the next two months. The Government’s strategy is likely based on an outcome that not only favours it but determines that the GBPA owes the Public Treasury a significant nine-figure sum.

Should this occur, it will likely issue a demand for immediate payment and, if the Hayward and St George families are unable to pay, one option open to the Government is to petition the Supreme Court for the appointment of a receiver over the GBPA and Port Group Ltd. That person, if appointed, could be charged with responsibility for selling both entities, and potential buyers other than Born Free Capital - such as Mediterranean Shipping Company (MSC) - will also be waiting.

Born Free Capital, in its investment presentation, said it “has negotiated with the shareholders of DevCO (Port Group Ltd and Hutchison) to buy the company and… its 75,000 acres on Grand Bahama island at a highly attractive price of $2,000 per acre”. That would value the deal at around $150m.

The presentation acknowledged that a US investor, thought to be Weller Development, the Six Senses resort developer, has an option to buy 2,000 of DevCO’s remaining 75,000 unsold acres but said this would still leave 73,000 for it to develop. “Investment restrictions and hurricanes have depressed Freeport’s property market,” Born Free Capital asserted.

“To create value uplift, Born Free Capital will leverage proven global expertise in storm surge protection, together with smart city and free zone design, to create a smart city by the sea and clusters of sector-specific special economic zones (SEZs) under the free zone regime.” Among the industry “clusters” identified were healthcare, digital and technology.

“Developing DevCo’s land holdings will likely be the most lucrative component of Freeport becoming a world-class, globally significant free zone with a ‘smart city by the sea’ of 250,000-plus people,” Born Free Capital’s presentation stated. It added that a major multinational maritime construction and dredging company “will fund the design, construction and maintenance of the dike systems to protect against storm surges and risk of rising sea levels”.

“Dike design will be in line with best international practice, able to withstand Category Five hurricanes. Final design and construction plans are subject to detailed geotechnical and hydrological investigations and modelling,” the presentation added. It cited the Port area’s 13 miles of coastline, 144 miles of bulkheaded canals, 472 miles of roads, $14bn worth of infrastructure and “deepest seaport” on the eastern US seaboard as key to its plans.

“Freeport’s value proposition as a free zone or ‘SEZ’ (special economic zone) rivals that of the highly successful free zones of Dubai and elsewhere in the Middle East,” Born Free Capital added. “Available developable land includes nine miles of beachfront to be developed first, along with a concentrated town centre astride Grand Lucayan Waterway.

“Three hundred million people are located within three hours’ flying time. Project Lionfish is crucial to unlocking that free zone potential, in that it will provide the city to house the people who will work in the SEZs…. Making Freeport safe from storm surges and re-establishing the Port area as a competitive free zone/SEZ should raise land values to equivalent of, for instance, Grand Cayman and Eko Atlantic (Lagos, Nigeria).”

Describing the US east coast and Caribbean rim as providing a combined $12.1trn market for Freeport to target, the Born Free Capital presentation said it would target “people of means and/or so-called ‘creative class’” including the thousands of millionaires seeking a new domicile. And the $2,000 per acre acquisition price for DevCo was portrayed as very attractive compared to the $50,000 per acre interior land price average in Nassau.

Born Free Capital said is targeting three times’ the value of that per acre price, taking it from $2,000 to $6,000 “upon completion” within 36 months. And, based on the per acre comparisons with Grand Cayman and Eko Atlantic, it is aiming for returns of between 22 to 72 times’.

Among the advisers listed by Born Free Capital are Omar Sands, in-house attorney for Brickell Management Group, the developer chaired by Island Luck co-founder and PLP Fort Charlotte candidate, Sebas Bastian. Also named are Hartley Thompson, a Freeport-born Bahamian entrepreneur now based in New York, who is chief executive of Microlink, an AI identity intelligence firm, and Dr Rob Millard, who crafted a strategy for Freeport’s development on behalf of Fleming Family & Partners when it explored the GBPA’s purchase more than 15 years ago. Another is Lord Anthony St John, a UK peer, and Jack Hefferman, head of Young America Capital, who is billed as having 40 years of Wall Street experience.

Pledging to build on the tax-free advantages conferred by Freeport’s founding treaty, the Hawksbill Creek Agreement, and make the city the special economic zone (SEZ) that its founders intended it to be, Born Free Capital said: “Other attractive tax neutral centres exist but none other in The Americas matches Freeport’s core value proposition for entrepreneurs and their businesses.

“The combination of deep seaport, large airport and plentiful land, all very close to the US east coast, is especially unique and appealing.”