Last Friday was the opening date for two initial public offers (IPO) on the Jamaica Stock Exchange (JSE) and given overwhelming demand, it was also the closing date of both.
The Mayberry Investments Limited (MIL) offer of Lumber Depot Limited officially opened at 9:00AM that day and closed to investors at 9:01AM. Meanwhile, Mailpac Group Limited’s IPO opened at the same time but closed at 5:00PM that day.
Lumber Depot aimed to raise approximately J$169.5 million from the issuance of 141,247,500 ordinary shares at a price of J$1.20 per share on the Junior Market of the Jamaica Stock Exchange (JSE). Of the 141,247,500 ordinary shares, up to 70,623,750 shares or 50 per cent were reserved and the remaining half for the general public.
Announcing the closure, its broker MIL advised the JSE that, “Mayberry will advise Applicants of the preliminary basis of allotment of the Shares by Tuesday, 26 November 2019, in accordance with the Junior Market Rules of the Jamaica Stock Exchange. The Company has made an application to list the Shares on the Junior Market of the JSE but makes no guarantee that the Shares will be so listed.”
Mailpac’s offer was for J$495 million to be raised from selling 500 million shares to the public. The listed closing date was December 6th however, 50 per cent of the shares were reserved for its broker, NCB Capital Markets.
That day, NCB Capital Markets issued a similar legal announcement to the JSE: “NCB Capital Markets Limited has advised that the Invitation for Subscription made by Mailpac Group Limited subject to a prospectus dated November 12, 2019 in respect of ordinary shares at the price of $1.00 to the general public and $0.90 to certain reserved share applicants, closed at approximately 5:00 PM on Friday, November 22, 2019.”
It has become common practice for investor to buy weeks before the open date of offers to ensure they are not left out, giving brokers the opportunity to quickly close offers on the opening date.