Emera Inc. (EMA-TSX) announced today that it has purchased 25% of the Grand Bahama Power Company Limited (GBPC) for US $41million through its acquisition of 50% of the shares of ICD Utilities Limited of the Bahamas. GBPC is located on Grand Bahama Island - the second most populous island in The Commonwealth of The Bahamas approximately 85 kilometres off the east coast of Florida.
"This opportunity is immediately accretive to Emera and is another measured investment in the Caribbean region following our initial investment in Lucelec last year. This utility has significant potential in a favorable regulatory environment," said Chris Huskilson, President and Chief Executive Officer of Emera Inc. "This acquisition positions Emera in the Caribbean marketplace and we will continue to seek additional opportunities to invest in the region."
The Grand Bahama Power Company is the only utility operator on Grand Bahama Island serving 19,000 customers. The generation consists of one facility with 137 MW of installed oil-fired capacity. The Grand Bahama Port Authority Limited regulates the utility and has granted GBPC a licensed, regulated and exclusive franchise to produce, transmit and distribute electricity on the Island until 2054. There is a fuel pass through mechanism and flexible tariff adjustment policies to ensure that costs are recovered and a reasonable return is earned.
Through its investment in ICD Utilities Limited, Emera will elect 3 members to the 7 seat board of directors of GBPC. Other investors in GBPC include Marubeni Caribbean Power Holdings Inc. which owns 55.4% and other ICD Utilities Limited shareholders which own 19.6%.
The Bahamas has a healthy, growing economy led primarily by the offshore banking and tourism industries. It has one of the highest income levels and GDP per capita in the Caribbean region. The Bahamas has low inflation reflecting its economic stability and has a track record of prudent economic management. -- www.cnxmarketlink.com
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