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No to $25.70

Trevor Yearwood

No to $25.70

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The Barbados Association of Non-governmental Organisations (BANGO) has told shareholders in the local power company to reject a whopping $25.70 Canadians are offering for each share.
However, the Barbados Association of Corporate Shareholders says it would prefer Barbados Light & Power (BL&P) shareholders to have a chance to own shares in the Canadian company Emera Inc. rather than a deal that would see them “wiped off the books”.
On Monday, Emera Inc. opened its offer to shareholders in Light & Power Holdings, the parent company of BL&P, to purchase all issued and outstanding common shares.
“If there is one criticism I have it is that acceptance of this offer will wipe out about 2 200 individual Barbados Light & Power shareholders,” president of the Barbados Association of Corporate Shareholders, Douglas Skeete, told the DAILY NATION yesterday.
“It would be good if the proposed buyer had offered a share exchange. They could have maintained the $25.70 price but give local shareholders the equivalent in shares in their company, which is listed on the Toronto Stock Exchange.”
Skeete added: “It would mean than when they are paying dividends, we would get a Canadian cheque, and that’s foreign exchange. So we are not only boosting Barbados’ foreign exchange position but also expanding our ownership of companies outside of Barbados.
“There can also be a mixed offer, where you get part of the $25.70 in cash and the remainder in shares in Emera Inc.”
BANGO, one of the agencies which fought against BL&P rate hike proposals this year, urged shareholders to “reject outright” the Emera Inc. offer.
“Unless we have a plan to move to alternative energy, and swiftly, in which case we no longer will have a use for the electric company, we shouldn’t sell Barbados Light & Power,” BANGO’s head Roosevelt King argued yesterday.
“What you will get $25 for today will be worth $50 tomorrow. But if we sell our asset now, we could find ourselves being squeezed by the Canadians down the road, when we are at their mercy.”
King said Barbadians needed to understand that money was not everything and there were some things that should remain in local hands.
“The money being offered by the Canadians may look very attractive, but the money is not the important thing – it’s the resource. If we do not take care of our resources, who will do it for us?”
However, Skeete said he did not buy the argument against foreign investment in local companies.
“Some people say Light & Power is a monopoly utility company and Government should not allow it to fall into Canadian hands,” he noted.
“If we stop other investors from buying our companies, we will run the risk of foreign governments retaliating when our companies try to expand overseas by acquiring businesses.”