Public will be provided with an opportunity to buy more shares in GRENLEC
Energy Minister Nazim Burke has given the assurance that the public will be able to purchase shares in GRENLEC when the new majority share owners take full control of the company which has been privately owned for the past eighteen years.
The present owner – WRB Enterprises effectively owns 61.4 percent of GRENLEC, recently offered the Grenada government the option of retaking control of the company by purchasing its shares for almost EC$100 million.
“We cannot buy the shares, we do not have the money to buy them,’’ Finance Minister Nazim Burke said at a news conference Monday. ‘We did not have to grab the company for the sake of ownership,” he adds.
Burke said, however, that Light & Power Holdings (LPH) of Barbados – which is majority-owned by Canada-based Emera Inc. – has “reached an understanding’’ with WRB and is close to completing a purchase agreement for the 61.4 percent shares in GRENLEC, the sole provider and distributor of electricity in Grenada.
Of the 61.4 percent shares, 50 percent was owned by Grenada Private Power, a subsidiary of WRB.
Another WRB-owned company, Eastern Caribbean Holdings (ECH) which is based in Belize controlled 11.4 percent. The National Insurance Scheme owns 11.6% of the shares; the Government of Grenada 10% while the other shares are owned by the general public.
According to Burke each share is presently valued at EC$11 but the new majority owners are purchasing them for EC$7.50. He further explained that the thinking of Government is to sell to the public and to increase NIS percentage.
In the new agreement, LPH will be allowed to purchase the 61.4%. “However in keeping with the Government’s policy that no entity shall own more than 50% of GRENLEC, the new agreement blocks LPH from having any voting rights associated with the Eastern Caribbean Holding shares and allows the Government to purchase them at the same price the LPH purchased the shares up to one year after the initially purchase is concluded,” Burke said
In anticipation of the LPH takeover of GRENLEC, government has been in negotiations with the Barbadian company and talks are “well advanced,’’ said Attorney General Rohan Phillip, who joined Burke at the news conference.
Phillip and Burke, who have been involved in the negotiations with LPH, said there will be amendment to the Electricity Supply Act to govern an agreement between the Grenada administration and the Barbadian company.
“Some laws are to be passed,’’ said Burke, adding that government is establishing a “regulatory framework to serve the best long term interests of the country.’’
At Monday’s press briefing, government circulated a 20-point document captioned, “The New Framework for Grenada’s Electricity Sector’’.
Point one states that “an exclusive license will be granted to GRENLEC to generate electricity from fossil fuels only.’’
Burke described this as one of the positive outcomes of the negotiations with LPH.
He said government had broken GRENLEC’s monopoly on electricity supply, and now was separating the generation of renewable energy from non-renewable sources.
Even though government couldn’t buy the WRB/ECH shares, said Burke, it used it as a “historic opportunity’’ to promote renewable energy, including a proposed project for the introduction of electric vehicles; and to put policies in place that are fair to all Grenadians.
“We are very pleased with the outcome of these negotiations,’’ said Burke.
“The government has moved swiftly and decisively to protect and enhance the interests of its citizens in a sector that is vital to national security. Access to affordable, reliable and clean energy is critical for the sustainable economic development of Grenada.’’
By Linda Straker