We meet today to make an announcement about the terms upon which members of the public service may purchase shares and become owners in the Arawak Port Development Company (ADP).
The terms I shall outline have never before been offered to public servants; we expect that this announcement today is the first of several.
We as a Government are committed to building a share owning society by deepening and broadening the ownership in the economy.
We began this journey in our first term in office; we continue today to build opportunities to expand our shareholding society.
During our first term in office we made 49 per cent of the shares of the Bank of The Bahamas available to the Bahamian public. Today more than several thousand Bahamians own shares in the Bank of The Bahamas. The Bank is now owned 24.04% Government; 27.78% NIB and 48.18% by Institutional Investors and the general public) The shares originally sold for $2.50 are now valued at more than $6.24 per share. At their high point they were valued at more that $9.
Secondly, when the funding for the second Paradise Island Bridge was done through the issuance of Treasury Bonds some 1,429 Bahamians invested in these long term investment bonds; they have proven to be some of the better investment opportunities for many citizens with moderate and higher incomes.
Thirdly, upon the introduction of Cable television services by the Government another opportunity was provided to ensure that Bahamians were afforded opportunities to acquire shares in what was certain to become a profitable company. Shares in Cable Bahamas were therefore made available to Bahamian citizens at a cost of $1 per share. Today, shares in Cable Bahamas trade at $8.38.
The creation of The Bahamas International Stock Exchange (BISX) in 1999 was a further step taken by my Government to facilitate the proper regulation of the investment sector and to make investments in privately held companies more accessible to more Bahamians.
Since returning to office in 2007 we have continued our efforts at empowering Bahamians to become shareholders in our economy.
When Heineken sought approval to acquire Commonwealth Brewery, we made our approval conditional on their making 25% of the shares in the company available to the Bahamian people. Today, some 3,000 Bahamians are shareholders in Commonwealth Brewery.
The construction of a new port at Arawak Cay is progressing rapidly now. The Port at Arawak Cay, which up to this time handled as much as 30% of cargo shipments to Nassau, is being expanded to facilitate the transfer of the remainder of the cargo port from downtown Nassau to Arawak Cay.
What I want to discuss with you today is efforts being undertaken by my Government to increase Bahamian ownership in shipping in this country.
As you will be aware, the ownership of cargo ports in New Providence has been controlled for many years by a small number of families including the Kelly’s, the Symonette’s, the Farrington’s and the Bethel’s. It proved to be a very profitable business for those families. Now we seek to make it profitable for a wider cross section of our population.
To this end my Government entered into a public/private joint venture ADP, to provide for the construction, management and operation of the new port at Arawak Cay.
The ADP at present comprises those families traditionally engaged in the shipping and cargo port business as well as with a number of other Bahamian families and companies who, in more recent times, have been engaged in shipping — families including the Moskos, Tennyson Wells, the Lightbourne’s, the Taylors, and the Curlings. As well the joint venture includes the members of the Mailboat Association; some 14 in all.
Under the terms of the Joint Venture, the Government contributed the land and we (the Government) and the private sector are providing the financing required for the construction. The private sector companies will now own 40% of the new Arawak Cay Port and the Government owns 40%. 20% of the shares in the Port Company are now being made available to the Bahamian public.
The shares, though now worth considerably more than the founding shareholders paid for them, will be offered at the same price the Government and the private shareholders paid plus expenses for the share offering. If you ever heard about a good deal, this is a good one indeed! By this sale of shares in the Port considerable wealth is being created for Bahamians who were heretofore excluded from participating and benefitting from profitable and lucrative port operations in New Providence.
The shares are a good investment. I highly recommend them for purchase by all Bahamians with the ability to purchase them.
Ownership of shares in the Port will make more Bahamians owners of a bigger portion of the Bahamian economy. And it will cause thousands of Bahamians to share in what the owners of shipping operations on Bay Street enjoyed for generations
I want very particularly to address some remarks to civil servants and other employees of Government-owned agencies and corporations – ZNS, BEC, the Water and Sewerage Corporation, Bahamasair and Tourism. Today the Government is creating an investment opportunity for employees of the Government by salary advance to facilitate public servants to become owners of shares in the Port Company.
Government employees will be able to purchase shares in ADP by way of salary advance repayable to the Treasury by salary deduction over a period of up to 12 months.
The minimum number of shares to be purchased is 50 and each share costs $10. Additional shares must be purchased multiples of 25. The maximum number of shares which may be purchased using the Government salary advance facility will be 500 – a little over $5,000.
Public officers and other government employees will be required to make application for the salary advance to the Financial Secretary, Ministry of Finance at P.O. Box N 3017, by hand at the Cecil Wallace Whitfield Centre on West Bay St. or electronically via FinancialSecretary@Bahamas.gov.bs.
Applications for advances will be considered by the Financial Secretary taking into account the post and salary scale of applicants as well as the ability of an individual’s take-home pay to accommodate the salary deductions required for repayment of the salary advance over the stipulated time.
The IPO gives a deadline for application for the purchase of shares as 31st January, 2012; hence government employees hoping to finance their purchase of shares via salary advance and repayment ought to make application to the Financial Secretary in the shortest possible time
I have invited the Financial Secretary, the Treasurer and the Permanent Secretary of the Department of Public Service to be here this afternoon to address any queries you may have with regard to the system of salary advances and repayment.
I have also invited the General Manager of ADP, Mr Mike Maura and representatives the placement agents, Providence Advisors (Kenwood Kerr and Carol Burrows) and CFAL (Anthony Ferguson and Jamaal B. Stubbs) to be represented here today so that they might answer any queries you may have with regard to the offer. — Rt. Hon. Hubert A. Ingraham