Marubeni Taqa Caribbean sells stake in Bahamas power company
Published:Friday | December 3, 2010 | 12:00 AM
Emera Inc has taken majority control of a power company in The Bahamas in a deal with the Marubeni-Taqa consortium that seems to mark the start of the unwinding of the Asian energy giants' partnership, weeks after disclosure by Taqa that it was selling out its stake in the Caribbean market.
Emera has acquired an additional 55.4 per cent interest in Grand Bahama Power Company Limited (GBPC) from MaruEnergy Grand Bahama Limited, pushing its stake to 80.4 per cent.
The deal is worth US$82 million, which translates to J$7 billion.
Emera, a CDN$6-billion Canadian company by assets in the business of electricity services, became a minority shareholder in GBPC two years ago when it acquired 50 per cent of a company called ICD Utilities Limited (ICDU), a holding company.
At the time, ICDU had 50 per cent ownership of GBPC, which operates a 137MW plant. The 2008 purchase, therefore, gave Emera a 25 per cent stake in GPBC.
Grand Bahama Power serves 19,000 customers on an island of 45,000 people and is the only utility on Grand Bahama. It operates under licence from Grand Bahama Port Authority Limited to transmit and distribute electricity to 2054.
The Bahamas, which is made up of hundreds of tiny islands, has a population of 310,000.
Emera said in a statement that as a result of the deal with Marubeni Taqa Caribbean Limited, it is also now the majority shareholder of ICDU, a company listed on the Bahamas exchange.
The holding company's other shareholders own the remaining 19.6 per cent of Grand Bahama Power, Emera said.
"Emera's Caribbean presence is strengthened by our majority ownership in Grand Bahama Power," said Chris Huskilson, president and chief executive officer of Emera Inc in the statement.
The company also non-controlling interest in energy assets in St Lucia and Barbados.
"We welcome Emera's increased investment in the Grand Bahama Power Corporation," said Neko Grant, minister of public works and transport in The Bahamas.
The deal with Marubeni TAQA Caribbean is subject to regulatory approval.
Taqa is exiting certain markets to focus primarily on the power sector in the Middle East and North Africa region, come 2011.
It will be also be withdrawing from the US.
Marubeni has said it would be buying out Taqa's interest in their joint-venture Caribbean business.
The Japanese company did not respond, up to press time, on whether there would be a similar retreat from other regional markets similar to the Grand Bahama sale.
The Marubeni Taqa Caribbean portfolio now consists of equity stakes in power generation and transmission facilities in Jamaica, Trinidad and Tobago, and Curaçao.