MINISTER of Finance and Planning, Dr Omar Davies, came under verbal fire from Opposition MPs, yesterday, after explaining that Mirant had sold its 80 per cent share in the Jamaica Public Service (JPS) Company Limited to Japanese firm, Marubeni Corporation, for US$800 million.

Yesterday the Atlanta-based company announced that it would offload its Caribbean operations, including the JPS, for US$1.082 billion.

But Opposition spokesman on mining, energy and telecommunications, Clive Mullings, whose remarks about the secrecy of the sale triggered Dr Davies’ explanation, pointed out that while Mirant had bought the shares from the government in 2001 for only US$200 million, in six years they were able to make a profit of US$600 million on the sale, in addition to the profits made locally since then.

“This cannot stand. A company that has exploited us, under an agreement agreed to by this government, turns around now and turns a profit of US$600 million and you say you care for poor people!” Mullings argued.

“Height of wickedness,” his Opposition colleague Andrew Gallimore shouted across the floor. They were joined by another Opposition MP, Delroy Chuck, who shouted “scandalous” at the minister.

The noisy exchange started when Mullings, while addressing the JPS issue during his contribution to the 2007/2008 budget debate, raised the issue of Mirant’s announcement yesterday morning about the sale and asked the minister whether he was aware of it.

“I didn’t want to interrupt. The answer is yes,” Dr Davies responded.

“I will also indicate that the minister with responsibility for energy and I met with the four short-listed entities in March. Every single one of them was eminently qualified in terms of technical competence and financial resources. And yes, we knew that Marubeni was the preferred bidder,” he added.

Davies said he intended to inform the country and that he had actually issued a statement yesterday on the issue.

However, he claimed that he was restricted in making public announcement by the US Security and Exchange Commission (SEC) regulations which, he said, were very strict on disclosures.

“There are issues which the moment an announcement is made it has to be public knowledge. You can’t leak information on issues like that, it could lead to insider trading, etcetera,” Davies stated.

“This deal is worth close to US$1.1 billion. I believe the value of the transaction for JPS, for 80 per cent of the share, is US$800 million,” the minister declared.

“Certain members recognise that the laws governing disclosure of information in the US have become much more stringent and hence any disclosure has to be simultaneous and released so everyone can know,” he added.

Mullings reacted that he was happy that “finally” the country has heard from the government on the sale. However, he insisted, “this cannot stand”.

“The government who sold JPS for US$200 million in 2001, that same JPS is now being sold, six years later, for US$800 million. The stewardship of this government has been weighed in the balance and found wanting,” he said.

Mullings then invited the government to appoint a joint select committee of Parliament to look into any arrangements with the new company, including the granting of a new electricity licence.

“We have paid dearly for the licence granted to Mirant and they have profited and done very well. We need to have Parliament involved before we enter into a new licence with this new entity,” he said.

Aside from JPS, Mirant’s other Caribbean operations include a 55 per cent stake in Grand Bahama Power Company, as well as its holdings in the Trinidad-based PowerGen, Curacao Utilities Company and a $40-million convertible preferred equity interest in Aqualectra, an integrated water and electric company in the Dutch island.

The sale price, Mirant said in a release yesterday, includes debt of US$350 million, power purchase obligations of US$153 million plus estimated working capital.