Massy Holdings Limited has announced the sale of its Massy United Insurance Limited (MUI) subsidiary to Bermudan based Coralisle Group Limited for US$90.5 million ($13.67 billion), as part of efforts to rationalise the group from a conglomerate to an investment portfolio.
The Trinidad and Tobago-based conglomerate has several business operations across the Caribbean. However, since 2018 the company has focused on supporting its autonomous business portfolios in the areas of integrated retail, motors and machines, and gas products. As a result, the group has disposed of various subsidiaries with its latest announcement being MUI, which comprises the property and casualty insurance business line under its financial services segment.
“Massy United Insurance was acquired as part of the Massy Group’s acquisition of Barbados Shipping and Trading in 2008. Massy Holdings Limited, through its subsidiary Massy (Barbados) Limited, currently owns 100 per cent of the share capital of Massy United Insurance Limited, a registered entity in Barbados whose principal activity is the provision of property and casualty insurance products and services in the Caribbean,” a press release outlined.
MUI operates in 20 territories across the English- and Dutch-speaking Caribbean. It got approval to operate its insurance business in Jamaica in December 2018, which got off to a solid start then. It generated $1.22 billion in gross premiums and $89.55 million in net profit for its 2020 financial year (FY) ending December 31.
MUI reported 22 per cent improvement in gross written premiums to BB$358.02 million (TT$536.8 million) for the 2020 FY ending September 30. It generated a consolidated net profit of BB$11.65 million ($868.7 million), had total assets of BB$625.96 million ($46.68 billion) and equity of BB$135.96 million ($10.14 billion). MUI has an A- (Excellent) rating from insurance rating agency AM Best.
The Coralisle Group is set of companies which provide regional insurance and pension fund management across the Caribbean region. It has equity in excess of BM$285 million ($42.89 billion) with premium income well above BM$370 million ($55.69 billion) and pension assets under management of BM$800 million ($120.40 billion). Some of the countries it operates in include The Bahamas, Barbados, Bermuda, The British Virgin Islands, and The Cayman Islands.
The deal is still subject to regulatory approval despite a share purchase agreement being signed on September 2.
Massy recently sold its 50.5 per cent stake in Roberts Manufacturing Limited to Proven Investments Limited for US$21.45 million. It also disposed of Massy Technologies to PBS Technology Group Limited for TT$341.63 million.
Meanwhile, Massy Gas Products (Jamaica) Limited recently announced its decision to build out a facility to store and distribute medical oxygen across the island.
These deals all come near the end of Massy’s 2021 FY, which closes at the end of this month and just ahead of its January 2022 cross listing to the Jamaica Stock Exchange. The bid was won by a joint interest of First Citizens Investment Services Limited (FCIS) and Barita Investments Limited. With no possible interest to raise additional capital, the listing might see a sale of shares by existing shareholders from Trinidad and Tobago.
“The whole Massy transaction certainly was great working with the FCIS team, but it took a lot of work from the Barita side of the team. This represents the most public deal that we would have worked on together. It shows the capability of a fairly young investment banking unit which started in December 2018. In particular, I’d like to highlight Miss Terise Kettle, VP of Investment Banking, who was well supported by Simon Johnson, AVP of Alternative Investments and Structured Finance,” Explained VP of Asset Management and Research at Barita, Ramon Small-Ferguson.