New corporate structure for
TelEm, Smitcoms approved
PHILIPSBURG--The Island Council approved a new corporate structure for local telephone company TelEm, its subsidiaries TelCell and TelNet, and international carrier Smitcoms on Monday evening.
The new structure involves the establishment of a holding company, which will hold the assets and supervise the other company, the operating company, which will be in charge of daily operations, including the staff, explained Commissioner of Telecommunications Franklin Meyers.
The resolution arranging the integration was passed with 10 votes for and one against, with St. Maarten Democratic Party (DP) and National Alliance (NA) voting in favour and People’s Progressive Alliance (PPA) against.
Explaining her motives for voting against the measure, PPA Councilwoman Gracita Arrindell said information and financial and other documentation were missing. She wanted the agenda point to be sent back to the Central Committee for more deliberation and to secure unanimous approval.
NA Councilman Frans Richardson said he could proudly vote in favour of the integration because the Executive Council had confirmed no employee of TelEm or Smitcoms would be sent home.
DP Councilwoman Maria Buncamper-Molanus said there had been ample discussion in the Central Committee and the Island Council was being asked to take a decision on approving the integration, approving the establishing of a new holding company and operating company and to transfer the shares of TelEm, TelCell and Smitcoms to the holding company. She said the integration greatly depended on the employees, to whom she referred as company assets.
The new company, aiming to be “lean and mean,” will strive to develop into a leader providing telecommunications services on the island, in the Netherlands Antilles and the region. Social and economic development also plays an important role. This would enable TelEm/Smitcoms to preserve its position as the number one service provider.
Among the core values are transparency, integrity and respect for the people. Objectives of the integrated companies include flawless execution of the TelEm/Smitcoms plan to safeguard the companies, to protect the customer base against defection to the competition, to aggressively pursue the tourist market, to improve reliability, stability and completeness of the operations as well as business support systems, and to build up St. Maarten as a major international data hub.
The company furthermore will strive to expand operations and service into neighbouring islands, establish partnerships with other service providers and expand network capabilities, including new packages such as video on demand and digital TV.
The customer will benefit from value-added and attractively-priced bundles of services that are easily ordered, supported and billed in an integrated manner. The result should be a wide variety at competitive rates and a secure, highly available and complete local and international network, providing a direct broadband access connection to the customer.
The viability of the three companies involved – Smitcoms, TelEm and TelCell –depends on the integration of all business units, to eliminate inter-company competition and the inter-company charges that make the services expensive in comparison to the competition.
The new corporate structure takes into account the culture aspect of the companies involved. Accumulated benefits of staff will be respected and personnel will be trained wherever necessary to ensure suitable placement within the new structure. New processes will be implemented, in compliance with recommendations made in audit reports.
Management will be charged with the physical implementation of the outlined internal structure of the management company, followed by the evaluation of staff, presentation of positions and job descriptions and placement. Staff will be transferred and placed within the operating company based on their assessment, qualifications and experience.
Permission from the Island Council was sought to establish a new holding company and management company, with draft articles of incorporation prepared by Notary Michael Alexander. The articles of incorporation had to be amended, as the new structure has one supervisory board of directors. The Island Territory will remain sole shareholder of the integrated company.
Commissioner Meyers explained that three reports had been drawn up regarding TelEm’s viability, with the first report suggesting laying off about 62 per cent of the staff. He said the reports hadn’t taken the social aspects of the companies into account. The Executive Council then decided to establish a committee to come up with a solution whereby TelEm could be made viable and all personnel could be kept on. “I think we found that solution,” he said, adding that he was proud nobody was being sent home. He said the integration had already taken too long.
Meyers explained during the meeting the difference between integration and merging, a term that had appeared in previous documents. He said the integration involved putting all companies under one umbrella, reducing the possibility of redundancy and companies remaining as they were. A merger generally entails one company taking over the other.
Answering a question by NA Councilman Hyacinth Richardson about the involvement of the unions in the process, Meyers explained that they had not been consulted, but that they had been informed about the plans. He said that after approval of the new structure, management would consult with the unions. He said no managing director had yet been appointed.
Responding to questions by NA Councilman William Marlin about alleged fraud at TelEm in the past, Meyers said these claims had been dismissed in a subsequent investigation by an independent firm. Measures have been taken to prevent fraud.
St Maarten vacation rental
