Inniss wants Bajans to see opportunities in BHL merger
Barbadians need not fear the pending buyout of local conglomerate Banks Holdings Limited (BHL) by overseas interests.
Amid intensifying public debate over major bids by two foreign beverage manufacturers – Trinidad and Tobago’s ANSA McAL and the St Lucia-registered SLU Beverages Limited — for takeover of BHL, the country’s business minister Donville Inniss today broke his silence on the move.
He pointed out that it was the duty of the state-run Fair Trading Commission (FTC) to ensure fair trade and that local consumers’ rights were protected, adding that in matters of this kind, the Government’s only obligation was to ensure the laws were followed, the rules of engagement adhered to, and that such transactions met all the necessary regulations.
“Beyond that, there is nothing the State can do. The State is not going to go and buy shares in company because we want it to be Barbadian. Not only we can’t afford it, but even if you had all the money in the world, it would be a bad act on the part of any Government to take up taxpayers’ money and go and invest in a private enterprise, just to say, it is flying the Barbados flag,” he warned.
Speaking on the sidelines of a ceremony marking the seventh anniversary of the signing of the Economic Partnership Agreement (EPA) with Europe at his Warrens, St Michael International Business office, the Minister contended that Barbadians were far too passive in business.
“Some of our companies quite frankly have sat here and have allowed themselves to be seen to be undervalued, which is a shareholder matter that shareholders have to get involved in,” said Inniss.
He drew attention to companies which may have 1,000 shareholders on record and only about five were active, pointing out that “they may be the five [that have] the majority shares”.
He suggested that some people only bought shares for tax purposes or to be able to boast of having them, but did not attend meetings or even read company reports.
The Cabinet Minister also expressed the view that some people only sat back and waited until the cheques for dividends arrived home.
However, Inniss called for a wider public debate on why so many Barbadian companies were being taken over by outside investors and questioned what results were being seen from the money spent in areas of tertiary education, social services and infrastructure.
He said the development called into question this island’s boast of a high literacy rate and competency skills.
“[In spite of this] we are not seeing more Barbadian companies going and taking over enterprises outside of Barbados. It may be that we are risk averse, and that has worked to our advantage in some instances . . . because I think if we had not been as conservative we would have seen more companies collapse along the way, or it may just be laziness, I don’t know!”
His wish is that more Barbadian shareholders and companies would get actively involved in mergers and acquisitions.
“There is a whole world out there that we need to be part of, and stop complaining when others come into our shores,” advised Inniss.
He zeroed in on the finance and insurance sectors, saying his particular worry was about the numbers in these industries, while suggesting there was need for more strategic alliances to be forged.
“It may be a case of having a company in Barbados that has excelled in a particular area in goods and services that may need to go in the OECS for example and forge a strategic alliance, but instead, we sit back here in Barbados [and] we want the Government to protect everybody from everything and when it doesn’t work out that way, then we want to throw our hands in the air in despair, and believe that the world is coming to an end.”
Inniss also suggested that a lot of good could actually come out the looming takeover.
For example, he said, the Brazilian company Ambev, which owns SLU Beverages Limited, may be able to expand BHL by bottling other drink brands in Barbados.
He also listed opportunities for transfer of technology and for locals to see themselves as part of a larger global enterprise.
“I don’t know that I can have the same fear of some people about plant closing down and people losing jobs; I think we need to be a little more optimistic,” said Inniss, while pointing out that there were also opportunities for individuals who may have wanted to part company with their shares to get a decent value for them.
“For the economy it may mean foreign exchange coming in if it is outsiders purchasing,” he said.
“I look at it through the lens of going global and bigger business,” Inniss said.