Grenada government backs down from preferential purchase offer for the Grenada Electricity Services paving the way for Emera to buy controlling interest through its Barbados subsidiary.

ST GEORGE’S, Grenada, Thursday January 3, 2013 – The Grenada government has been unable to come up with the EC$90 million required to take back controlling interest of the Grenada Electricity Services (GRENLEC).

Now, Florida-based WRB Enterprises, which bought majority shares in GRENLEC from government in 1994, is open to sell its 61.4 percent holding in the island’s sole electricity provider to Canadian-based power company Emera, which has been patiently waiting in the wings.

Grenada Finance Minister Nazim Burke admitted at a recent press conference that his government did not have the finances to buy the shares and 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.

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), controlled 11.4 percent.

WRB was also the majority shareholder in the Dominica Electricity Services Ltd. (DOMLEC) and last November WRB and LPH announced that they had entered into an arrangement for LPH to take over WRB’s 52% stake in DOMLEC. LPH also holds a minority interest in St Lucia Electricity Services, and Emera also has interests in the Grand Bahama Power Company.

Grenada Attorney General Rohan Phillip also told the press conference that, in anticipation of the LPH takeover of GRENLEC, government has been in negotiations with the Barbadian company and talks are “well advanced”.

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.

At the press briefing government officials circulated a document entitled: “The New Framework for Grenada’s Electricity Sector”, which included a provision for GRENLEC to have only exclusive rights to generate electricity from fossil fuel.

Burke noted that with this provision government had broken GRENLEC’s monopoly on electricity supply, paving the way for other players to get into electricity generation on the island from renewable sources.

In addition, said the finance minister, government has the right to purchase within 12 months, 11.4 percent of LPH’s 61.4 percent GRENLEC shares at a price of EC$7.50 per share.

The minority partners in an LPH/Emera-controlled GRENLEC will include the Grenada government with 10 percent shares, and the National Insurance Scheme with 11.6 percent.

Members of the public – Grenadians and other Caribbean nationals – hold 17 percent.
Source: caribbean360