Sagicor Bank Jamaica Limited headquarters in New Kingston, Jamaica (File photo)

Sagicor seeks to raise J$4 billion with new manufacturing-based IPO

Sagicor Bank Jamaica Limited headquarters in New Kingston, Jamaica (File photo)

Investors are invited to buy into the Sagicor Select Funds Manufacturing Index (SELECTM) for J$1.00 per share at a minimum of 1,000 shares. 

Sagicor employees will be able to buy shares at J$0.98.  The total offer is 2.5 billion shares with the option to upsize by an additional 1.5 billion.

Chairman of the SELECTM, Colin Steele says, “The Manufacturing and Distribution Select Fund seeks to provide the following benefits:  diversification and liquidity; cost effectiveness; tax-effectiveness; easy entry and exit; certainty of information and passive management.  These numerous advantages may be realized by investors subscribing for the shares in the Fund.” Further, Steele says, “you are invited to participate in another exciting chapter in the evolution of the securities and capital markets in Jamaica.”

Chairman of the SELECTM, Colin Steele

The offer opens on November 20, 2019 and closes on December 4, 2019 at 4:00PM.

The manufacturing and distribution index tracks the performance of all the companies engaging in manufacturing and distribution activities that are listed on both the Junior and Main markets of the Jamaica Stock Exchange (JSE).  The JSE typically uses a weighted average market capitalisation method to calculate the indices. 

The SELECTM will invest in a wide variety of companies such as Caribbean Cement, Wisynco Group, GraceKennedy, Seprod Limited and Jamaica Broilers.

Sagicor Investments will incur J$50 million in fees to launch the fund. The fees cover:

  1. The arranger, financial advisory and brokerage fees;
  2. Legal fees;
  3. Auditor’s and accounting fees
  4. Statutory fees including initial listing fees
  5. Marketing expenses; and
  6. Registrar and transfer agent fees

The SELECTM will be structured with five classes of shares which have different voting rights. 

  1. Class “A” shares will have non-redeemable voting shares that are equivalent to 51% of the aggregate number of votes.
  2. Class “B”, Class “C”, Class “D”, Class “E” shares shall be redeemable voting and participating ordinary shares without par value in which one vote per person. 

The Sagicor Investments Jamaica team will be the only Class “A” shareholders as a result of being the Fund manager.  According to the prospectus, “the purpose of the management share is to ensure that the structure of the investments made by the company, and by extension the investment objectives of the Company is not subverted by shareholders holding shares in the other share classes who may acquire substantial interest in the Company.”   The shares listed on the JSE Main Market and the Sagicor Sigma Fund will be Class “B” and “C” shareholders.