Govt. shares in GT&T up for sale again

Nov 24, 2010 News

The National Industrial Commercial and Investment Company Limited (NICIL) has seemingly yet again not found favour with the bids it received during the last request for proposals for the purchase of the shares it owns in the Guyana Telephone and Telephone Company (GT&T).
Recently the union for the workers had expressed interest in purchasing the shares.
As such the entity has again invited proposals from interested firms/individuals to purchase Government’s 20 per cent “en bloc” shareholding in GT&T.
According to the invitation which is posted on the government eprocure.gov.gy website, “GT&T is 20 per cent owned by the GoG via NICIL and 80 per cent owned by Atlantic Tele-Network, Inc. (ATN), a publicly traded telecommunications company, headquartered in Salem, Massachusetts.”
The invitation specifies that interested persons must register with the Privatisation Unit and pay a registration fee of $15,000.
Upon registration, the following will be provided: – A Request for Proposals (RFP) Document, An Information Memorandum containing general information of the Company, A Copy of the advertisement and a Draft Share Sale Agreement.
The new deadline for proposals is December 3rd, 2010 at 14:00 hrs.
It was noted that, “GOG/PU/NICIL is not bound to accept the highest offer and/or proposal.”
The Guyana Government has for a while now signaled its intention to sell its 20 per cent shares owned in the Guyana Telephone and Telegraph (GT&T) and has made several invitations for interested persons or companies to purchase the shares.
The previous deadline stipulated by the Privatisation Unit was 14:00hrs on September 24.
GT&T’s parent company has already rejected the offer to buy Government’s 20 per cent shares in the telephone company.
Atlantic Tele-Network (ATN) at its recent Board of Directors meeting, declined to purchase the shares.
Since 1991, the minority shareholder received zero dividend payment until the year 2000 and since then, the annual amount has fluctuated from US$1M to US$4M, while the company has been reporting impressive profits over the same time.
The Government of Guyana had placed the shares on the market and according to a senior official the lack of interest by persons to purchase the shares is as a result of the administration’s own fault.
A senior official told this newspaper that the government created the conditions that the investors find unacceptable.
The official suggested that it was akin to advertising a house for sale one day and the following day tearing down the fence, and at a subsequent date, damaging the wall of the building.
According to the official, the bringing in of a fibre optic cable by Government and the liberalisation of the sector among other moves, have created the conditions that are warding off investors.
Many in the political circles have opined that the government is deliberately creating the conditions so that a ‘sweetheart deal’ could be offered to a favoured investor.
In 2008, the government collected $1.5B in taxes from the company and $265M in dividends.
The Office of the President subsequently stated that the decision to dispose of the minority shareholding was based on the fact that the government’s directors have consistently been prevented from exercising any influence, whatsoever, on the affairs of the company.
Head of the Privatisation Unit, Winston Brassington, during an interview with this newspaper on May 8, last, stated that the telephone company’s financial status is excellent, making it a prime time to sell its shares.
“We are hoping to get a very good value…You value your share based on how much money you can make…I do not believe that any other company in Guyana is doing as well as GT&T,” Brassington had said.
He had stressed that the administration will not ‘give away’ or sell its shares ‘cheaply.’
However, the opposition is calling for an investigation behind the reason why the Government wants to sell its shares in the company. The Opposition is contending that the real motive behind the selling of these shares is intended to ‘benefit the friends and supporters of the PPP’.

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Govt. shares in GT&T up for sale again

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