Otis told to meet ownership rules
60 percent of its ownership to Bermudian interests, The Royal Gazette has learned.
Otis North America has agreed to divest a 30 percent share of the company by December 31, 1995 and an additional 30 percent by December 31, 1997.
The Otis company here is being required to comply with the Island's 60/40 rule which says 60 percent of every local company must be Bermuda-owned. The exceptions are exempted companies, which are not permitted to do business within Bermuda itself.
Finance Minister the Hon. Dr. David Saul said yesterday that when Otis was given its company licence in Bermuda last year they were asked to continue moving toward the 1981 Companies Act 60/40 requirement.
Companies can be given special licences to operate here under certain circumstances, as was the case with Otis and the need for elevator construction, explained Dr. Saul.
"We've done this (pursued 60/40 Bermudianisation) for several companies,'' he said.
Government is endeavouring at this time to get other companies to comply as well, he continued.
"The government has required Otis to sell a 60 percent share of the ownership of the business to comply with Bermuda law,'' said Mr. James Siegel, vice president and area manager with Otis North America.
"We have a ways to go (and) this requirement is not new to us,'' he said.
Mr. Siegel said it "concerned'' Otis that they were being required to comply with this rule despite being in Bermuda before the 60/40 legislation came into effect.
Otis has had a presence in Bermuda for a century.
There is concern over the divestment, he added, as the company wishes to continue to provide a high level of service to the Island.
"We've had talks with several companies in Bermuda seeking advice (about potential owners) but we are we are in the initial review stages,'' he continued.
Otis Elevator Company, headquartered in Connecticut, is owned by United Technologies Corp., a public company, also located in Connecticut.
Mr. Bill McCoy, managing director of the Bermuda Otis operation, could not be reached for comment yesterday.
