On the first anniversary of the sale of the majority interest in the Bahamas Telecommuni-cations Company, the process for licensing two new cellular phone operators will be started, the committee overseeing the BTC privatization process revealed yesterday.

In the House of Assembly last week, Prime Minister Hubert Ingraham announced the government's intention to liberalize fixed line services immediately on the completion of the sale of 51 percent of its interest in BTC and liberalize cellular services a year later.

"We are seeking to liberalize the telecoms sector in The Bahamas in the shortest possible time, in the full knowledge that we are behind everybody else in our region," Ingraham said at the time.

The privatization negotiating committee, which has established a process of public information, said in a release yesterday that this approach would balance the value government receives for the sale of its stake in BTC against early introduction of competitive, quality communications services throughout The Bahamas.

The committee said after interested cellular operators come forward, there will be an auction of the two new licenses.

The successful parties will then be permitted to recruit staff, build their networks and negotiate necessary technical agreements, the statement added. It said it will be a condition of the licenses that operators will begin commercial services by the second anniversary of the BTC sale transaction.

"In order to ensure that the Bahamian public receives the best possible choice, quality and price of services, the government is determined to ensure that those who hold licenses to operate in The Bahamas must have world-class management, financial and operational strength and a track record of success," the statement said.

It also informed that BTC has been updating its business plan, setting out how the company sees itself developing over the next several years, and the international accounting and business advisory firm of KPMG has been reviewing this plan. The statement noted that it is an important document for any investor, and it is pivotal to establishing an 'enterprise value' of BTC for the purposes of the sale negotiation.

According to the statement, a report on this will be issued in the next few weeks.

The committee announced that it has appointed KPMG to advise on all aspects of the proposed sale, including preparing BTC for privatization, valuation, and regulatory and legal revision of the Bahamian communications environment.

It also announced that Citi Group, New York, has been engaged to identify a buyer for the company, and the international firm of Charles Russell LLP, in cooperation with the Bahamas legal firm of Higgs and Johnson, to advise on all legal aspects of the project, including the sale.

The committee has been negotiating with the Bluewater group, and Prime Minister Ingraham reiterated last week that the government intends to have BTC sold by the end of the year.

"Whether or not we're going to be able to make that date is questionable at the moment because there are many issues that need to be settled," he said. The prime minister in the past has referred to the company being privatized before the end of the 'fiscal year'. He has also said the government intends to use the proceeds from the sale to build a new hospital.

The privatization committee said yesterday that changes to The Bahamas communications legal and regulatory environment will be necessary to enable liberalization to take place. It said recommendations in this respect are being drafted and will be completed within the next few weeks.

"As this process moves forward, certain key principles are being adhered to. One such principle is the government's commitment to ensuring that all communities of The Bahamas, of 10 or more households, benefit from a quality of service equivalent to that available in New Providence," the committee said.

"This privatization is important to all who live and work in The Bahamas and to those who visit, whether for business or vacation. It will improve telecommunications services, lower costs and bring new opportunities in an enhanced communications sector to all Bahamians wishing to pursue careers in or connected to communications, including existing employees of BTC."

The sale of the company is projected to be between $230 million and $300 million, according to a source close to the privatization talks.

By CANDIA DAMES

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