Thursday, November 7, 2019
By YOURI KEMP
The two Grand Bahama International Airport shareholders are engaged in high-level talks over the government's desire to acquire the asset from them, it was revealed last night.
Ian Rolle, the Grand Bahama Port Authority's (GBPA) president, confirmed that the Hayward and St George families, as well as Hutchison Whampoa, are discussing how to respond to the government's stance on a facility that is key to the island's revival.
"I know my shareholders would entertain anything in the best interest of Freeport," Mr Rolle told Tribune Business, declining to address the situation further. He spoke out after Dionisio D'Aguilar, minister of tourism and aviation, confirmed the government is mulling the acquisition after blasting Hutchison Whampoa's failure to "demonstrate an effort" to urgently restore the airport to its pre-Dorian state.
Disclosing that it will likely cost between $20-$40m to rebuild the airport terminal and associated facilities, Mr D'Aguilar pledged that the Government will not make any purchase decision "on the fly".
He promised that, rather than rush into a deal as it was accused of doing over the Grand Lucayan, the Government will first determine how to make the airport profitable before it commits the Bahamian taxpayer to another potentially risky multi-million dollar outlay.
"Certainly it is under consideration to buy the GBIA," Mr D'Aguilar confirmed when questioned outside the Cabinet Office. "Hutchison Ports have not demonstrated an effort to rebuild the airport to where it was before. They seem somewhat reluctant, so the Government is considering its options."
However, Mr D'Aguilar said the Government will not rush blindly into any acquisition. "Buying the airport is the easiest thing," he warned. "It is what you do once you get the airport. The focus of the Bahamian people is now for Hutchison Ports to do something with that airport. Once the Government buys it, the focus will now go towards the Government, and what will the Government do about it?
The minister estimated that rebuilding Grand Bahama International Airport could cost between $20m to $40m, and added: "You have to figure out where that money will come from, and you have to consider who the operator is going to be, and you have to consider how that airport is going to make money.
"So before we spend the money of the people of The Bahamas, you have to consider these things and I don't think the Government wants to be rushed into this thing. We have to think through the purchase."
Mr D'Aguilar continued: "You can't just buy it where it will just sit there. You have to have a plan. We just can't make a decision on the fly. You have to do the research and look at the business model and study the financials. You have to consider all of these things.
"The objective is going to be revenue source. How will the airport fund itself? Obviously we will look at the Nassau Airport Development (NAD) model at the Lynden Pindling International Airport (LPIA); obviously the LPIA has more traffic than what they have in Grand Bahama.
"So, are we considering it? Yes. But we are working through all of the proposals and considering how we will make it work once we acquire it."
Prominent businessmen such as Magnus Alnebeck, the Pelican Bay hotel's general manager, together with Michael Scott, the Hotel Corporation and Grand Lucayan chairman, have previously urged the Government to acquire Grand Bahama International Airport given that the island's tourism and industrial business model "won't work" if it is unable to receive international airlift.
While Freeport's stopover tourism product is still moribund in Dorian's wake, the airport - and associated airlift - are set to assume greater importance in the coming months due to the development of Carnival's $100m cruise port and the proposed ITM Group/Royal Caribbean joint venture that includes the $195m first phase acquisition of the Grand Lucayan and harbour redevelopment.