By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

FOCOL Holdings is in “advanced talks” to raise $300m-$500m for overhauling New Providence’s energy generation via “the largest private sector financing deal to ever take place in Bahamian dollars”.

Senior bankers confirmed to Tribune Business that the BISX-listed petroleum products and energy supplier, which was selected by the Davis administration to reform electricity generation for New Providence, is seeking to raise a syndicated loan from a consortium of Bahamian banks.

Both Sir Franklyn Wilson, FOCOL Holdings’ chairman, and Dexter Adderley, its president and chief executive, declined to comment when contacted by this newspaper yesterday, but company executives have been “making the rounds of the banks” in a bid to raise funding vital to fulfilling the Government’s ambition to lower energy costs - and improve supply reliability - for thousands of homes and firms.

The proposed syndicated loan, which would be sourced from multiple Bahamian commercial banks, will finance various commitments that FOCOL and its subsidiary, Bahamas Utilities Holdings, have made to the Government as part of their energy reform deal. It will likely fund construction of both the liquefied natural gas (LNG) regasification terminal at Clifton Pier and the planned new Blue Hills power plant.

“Talks to arrange the largest private sector financing deal ever to take place in Bahamian dollars are at an advanced stage,” one source, speaking on condition of anonymity, told Tribune Business of negotiations between FOCOL and the banks. They added that the amount of capital sought, said by contacts to be between $300m and $500m, was “very close” to the actual amount being discussed.

Gowon Bowe, Fidelity Bank (Bahamas) chief executive, confirmed to this newspaper that FOCOL Holdings executives have been taking “soundings” from local commercial banks to gauge their appetite and support for such a large debt financing.

Referring to the $99.6m that the BISX-listed firm has already obtained from the US Export-Import Bank to part-finance its role in the electricity generation reforms, Mr Bowe said: “I think it’s widely known that FOCOL had indicated they have the backing of one of the multilateral banks, and are looking at a syndicated loans in terms of the funding of the recent power purchase agreement (PPA).

“The formal proposal has not come across, but there has been the outreach by the syndicate lead as to what they’re trying to do, and executives from FOCOL have indicated from soundings this was something they were looking to move ahead with and garner the support of the domestic market.... As far as I’m aware it’s not closed. They still have to deal with some of the terms.”

A syndicated loan involves multiple lenders, in this case Bahamas-based commercial banks, teaming up to provide debt financing to a single borrower. Each institution takes a piece of the total loan amount, ensuring the risk is spread between multiple lenders although this is not always spread evenly as one typically takes on the role of lead arranger.

Mr Bowe hinted that the syndicate lead for the FOCOL transaction is not domestic, but declined to name them. However, Tribune Business sources suggested this role is likely being fulfilled by CIBC Caribbean and its regional head office in Barbados.

“It appears that FOCOL, based on the conversations, will be looking to finance the PPA project through a syndicated loan as opposed to raising capital through shares or bonds,” the Fidelity Bank (Bahamas) chief said. “The numbers you quote ($300m-$500m) are not unreasonable if they’re looking to do this through bank financing as opposed to capital markets financing.

“They are approaching it from bank debt financing as opposed to the capital markets; at least in the initial stages.” Another contact, speaking on condition of anonymity, confirmed: “FOCOL is trying to get a massive syndicated loan, north of $350m, locally from the banks. That will be for Bahamas Utilities Holdings. It’s a lot of money. They were making the rounds of the banks, so I was told.”

Besides the LNG regasification terminal, which is a joint venture with Shell North America, and the proposed 177 mega watt (MW) new power plant at Blue Hills, the source said the syndicated loan proceeds will likely finance the acquisition and/or construction of specialist LNG tankers that will transport the fuel to both FOCOL’s New Providence facilities and other power producers in the Family Islands.

The Davis administration has structured the energy reforms such that a government-owned special purpose vehicle (SPV) will purchase all the required LNG before selling and shipping it on to the privately-owned energy producers in both New Providence and the Family Islands. Shell and FOCOL will likely play a key role in this distribution set-up.

Additional capital is required because the US Export-Import Bank financing is only sufficient to fund FOCOL’s acquisition of equipment for the two pipelines that will carry fuels from Clifton Pier to the Blue Hills power station plus the purchase of two aeroderivative gas turbines - capable of using multiple fuels - from General Electric (GEV) Vernova.

Bahamian commercial banks certainly have sufficient capital seeking opportunities to earn a return given the combined $3.248bn in excess liquid assets on their collective balance sheets at end-July 2025. And FOCOL’s PPA with the Government and Bahamas Power & Light (BPL) will reduce the risk associated with any loan because it guarantees a revenue stream for 25-30 years to fund repayment.

The Government, though, has yet to publicly disclose the FOCOL PPA or terms of the deal, meaning that Bahamian households and businesses still do not know the price BPL and, by extension, themselves will pay for energy over the next several decades. However, collective fuel savings for consumers have been pegged at $100m per year once all aspects of the New Providence reforms are implemented.

FOCOL’s Mr Adderley, in a June 2025 interview with Tribune Business, confirmed the goal is to have all four 30 MW generation engines it has purchased operating from the yet-to-be constructed “combined cycle plant” at Blue Hills. This will “capture” the engines’ waste heat and employ this to produce additional energy at no extra cost. Site preparation and clearance for the LNG terminal is already underway.

The FOCOL chief also alluded to the company’s expanded financing plans while describing the US Export-Import Bank (EXIM) funding as “extremely significant to the overall financing package”.

“This is a very significant portion of the overall financing package for the LNG power project. It’s not the final component,” he told this newspaper. “There are two other components to follow; all about the same time. These are being done in parallel, and they are on track to close on time. I would say we are extremely confident.

“There’s no reason for doubt. We have early commitments on all the financing needs. We have commitments on the full financing needs for the project. It’s now a matter of doing due diligence and process. There’s commitments to meet the full financing needs of the LNG to power project. It’s several hundred million dollars in total.... maybe just under $500m.”