Bahamians may be offered shares in Cayman water company

Saturday, October 11, 2003

NASSAU, Bahamas: According to the Nassau Guardian, Bahamians may soon be offered the opportunity to invest in a Cayman-based water utility. 

Consolidated Water Company operates reverse osmosis seawater conversion facilities in the Cayman Islands, Belize, Barbados, and the British Virgin Islands. It recently acquired a majority shareholding in Nassau-based Waterfields Company Ltd from the Barcardi family and other local shareholders. 

"We have a policy of encouraging local people in the countries in which we operate to invest in CWCO and share in the benefits of their own development," Jeffrey Parker, chairman and chief executive officer of Consolidated Water told the Guardian. 

"Unlike an investment in a private company like Waterfields, an investment in Consolidated has a market price quoted in the USA and is liquid for purchases and sales," he said." 

He said that subject to exchange control and securities regulations in the Bahamas, the Consolidated offer would be based on dividend reinvestment, direct-share purchase, and direct-dividend deposit plans. 

But one local financial analyst said he would be "surprised" if the government allowed a foreign company to raise money from local investors: "That has only been done once before - by Cable Bahamas in 1995. 

"This plan will make it easy and cheap for small and, perhaps, less-sophisticated local investors, although we appreciate that there are exchange control issues," Mr Parker said. 

Mr. Parker said Consolidated Water has a history of working closely and cooperatively with governments and regulators of the countries in which it operates, and hopes to continue that with the government and the Water and Sewerage Corporation in the Bahamas. 

Waterfields Company was incorporated in 1996 and has been supplying water to the Water & Sewerage Corp. since then. Consolidated held a 12.5-per-cent stake in Waterfields as well as the engineering services contract for the company. 

On July 30, Consolidated acquired an additional 13.5-per-cent stake in Warterfields and a management services contract from Bacardi. Consolidated made a tender offer to the other shareholders of Waterfields and received acceptances that will eventually take its total ownership to just over 90 per cent. 

The Waterfields plant has a capacity of 2.6 million gallons a day and there is provision in the contract to increase its size. Consolidated is expected to work with the Water & Sewerage Corporation to explore the possibility of an expansion, Mr. Parker said. 

Consolidated develops and operates seawater-conversion plants and water-distribution systems where supplies of potable water are scarce or nonexistent. 

It operates a public water utility in areas of the Cayman Islands under a 20-year exclusive license from the government. 

The first plant, in Cayman in 1973, made 14,400 gallons of water a day. Today it operates six plants in Cayman making 5.3 million gallons of water a day. 

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