Cable Bahamas Ltd. (CBL) has been confirmed as the winner of the second mobile license, which will be awarded for a 15-year period. Within the next three months, CBL must provide 99 percent mobile coverage in New Providence and 80 percent coverage in Grand Bahama. That according to Prime Minister Perry Christie, who, during his budget communication in Parliament yesterday, announced that he had instructed the Utilities Regulation and Competition Authority (URCA) to proceed with issuing the license.

Christie reiterated that a new Bahamian company - NewCo - had been formed to hold the cellular licences, and that CBL would be a minority shareholder of NewCo. Another Bahamian company - HoldingCo - has been incorporated with the government as the sole shareholder, and holds the majority equity ownership interest in NewCo on behalf of the Bahamian public.

The share split Christie cited is that HoldingCo will hold "51.75" percent of the shares in NewCo and CBL will hold the remaining "48.75" percent. Guardian Business notes these figures add up to 100.5 percent.

Said Christie, "In light of CBL having met the remaining requirements of the request for proposal (RFP), I am pleased to advise that the government has notified the Utilities Regulation and Competition Authority (URCA) to proceed with the licensing of NewCo. Although CBL will have management and board control of NewCo, HoldingCo will have certain standard market veto rights in order to protect its investment."

The prime minister added that the government's shareholding in HoldingCo, however, is intended to be temporary in nature and a "caretaker board" would be appointed until such time as HoldingCo's shares have been divested.

"In the meantime, the focus of the (Cellular Liberalization) Task Force and its advisor, PricewaterhouseCoopers, will shift to soliciting eligible investors. This process however, will not interfere with the timing of NewCo's launch once the relevant licenses have been granted by URCA.

"It is proposed that HoldingCo's shares will be offered to institutional investors (e.g. local pension/mutual funds, cooperative credit unions) within the next few months. Such an offering will ensure that the equity ownership in HoldingCo is as widely distributed as possible so that there will be broad Bahamian ownership," he said.

Coverage
Christie explained that under the licences to be awarded by URCA, and from the time that the licences are awarded, NewCo will be required, on a phased basis, to provide within three months 99 percent mobile coverage in New Providence and 80 percent in Grand Bahama. Within six months, the coverage must reach 75 percent in each of Eleuthera, Abaco, Bimini, Andros and Exuma (including Black Point, Little Farmers Cay, Staniel Cay and Stocking Island); and within eight months, 85 percent in Andros and 99 percent in each of Grand Bahama, Eleuthera, Abaco, Bimini and Exuma.

Within a year, coverage must be 99 percent in each of Andros, Cat Island, Long Island, San Salvador, Berry Islands, Inagua and Ragged Island; and within 18 months, 99 percent in each of Acklins, Crooked Island, Long Cay, Rum Cay and Mayaguana.

Within 24 months, coverage must reach 80 percent in each of the remaining Exuma Cays.

"I wish to emphasize what the coverage obligation under the licences will entail. A 99 percent coverage requirement, for example, means that NewCo will have to ensure that reliable service is available in 99 percent of the places where persons habitually live and traverse.

"It should be noted that NewCo's performance with respect to its license obligations will be secured by a performance bond to be submitted to URCA within 14 days of the licences being granted.

"Over and above the roll-out obligations in the licenses, the government will also enter into a deed of undertaking with CBL to facilitate accelerated roll-out, if needed, in the context of contemplated development on specific Family Islands in the southern Bahamas.

Response
Responding to the announcement, CBL President Anthony Butler stated, "This is an historic and pivotal day for The Bahamas and we are proud to have won the license. But, it is the Bahamian people that are the real winners. Now, the hard work begins, and our focus will be to fulfill our promise to the Bahamian community to provide the best mobile services and applications in the world."

Butler said CBL understands the market and the expectations of Bahamians.

"The mobile service needs to be reliable, affordable and fully support applications that customers want to use, and that is what Bahamians can look forward to from us."

In a statement welcoming the announcement, CBL said starting yesterday, it commenced the timeline to providing service.

The statement quoted CBL Vice Chairman Franklyn Butler.

"This is a far-reaching moment for us Bahamians, and for us as a company, as a business, as a people. I have every confidence we will deliver the same focus, commitment and success seen to date in CBL as we bring mobile cellular services to the people of The Bahamas," he said.

K. Quincy Parker, Guardian Business Editor

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