Government widens search for GPL investors
Stabroek News
April 30, 2004
The government has cast its net wider in a search for a US$35M equity injection into the Guyana Power and Light (GPL) for 50% of the company, Prime Minister Sam Hinds announced this week.
Speaking with Stabroek Business, the Prime Minister said that he would be meeting with various financial institutions and unions to elaborate on the offer in two weeks .
The government had initially tested the offer by sending it to a few select persons in the financial community before deciding on refining the offer and sending it out. The offer is now with the National Insurance Scheme, pension funds and insurance companies.
"I am leading the process as of now and I am sending a message that we need investment in the electricity company," Hinds said on Tuesday. The government expects that its offer will lead to the formation of a widely-held consortium of financial institutions to invest US$35M in the utility in three tranches over two years. Preliminary indications are that the expectation is a bit high, as CDC/ESBI had been given three years to bring in US$22M.
Demerara Mutual Life and General Insurance Company may take the lead in the formation of the consortium, understands.
The government is willing to rework the rate of return formula, remove the performance targets from the licence which includes loss reduction targets, offer a guaranteed return of treasury bills plus three per cent to investors and forego dividends for 10 years to minimise the effect of rate of return on tariffs.