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Derrimon makes early redemption of its 9% cumulative redeemable preference shares

Commodities and distribution company Derrimon Trading Company Limited has made an early redemption of its nine per cent cumulative redeemable preference shares maturing later this month.

The preference shares, which are traded on the Jamaican stock market, were redeemed as early as March 5, 2021. This is more than three weeks before the March 31 maturity date.

Derrimon floated the nine per cent cumulative redeemable preference shares in March 2018, offering as much as 175 million 2021 preference shares at a price of $2.00 per share for a maximum capitalisation of $350 million. The company has already served notice on the Jamaica Stock Exchange (JSE) of its early redemption of the nine per cent cumulative redeemable preference shares.

SHARES TO BE DELISTED FROM THE LOCAL STOCK MARKET

In addition, Derrimon has made an application to the JSE to have the shares delisted from the local stock market. The proceeds of the preference shares offer were used mainly to repay the 2018 preference shares that matured in March 2018.

Additionally, part of the proceeds went to paying expenses for the preference share offer not exceeding $10 million, inclusive of brokerage fees, legal fees, registrar fees, listing fees and General Consumption Tax. Any remaining proceeds were used for general corporate purposes.

News of the early redemption of the shares last week came as the food and distribution company announced that it has closed its acquisition of controlling interest in Food Services New York, Inc and Good Food for Less.

Derrimon has advised that the final price was US$8.9 million, coming in at the lower end of the range, which it indicated prior. Now that the deal is closed, Derrimon now has a controlling interest or 80 per cent stake in FoodSaver NY and Good Food ).

ACQUISITION WILL AID IN DERRIMON’S GLOBAL PUSH

The acquisitions will provide Derrimon with greater access to markets and more customers as the company moves to push its products globally. Derrimon, through an incorporation of New York subsidiary Marnock LLC, will acquire control of the Brooklyn-based operations as a going concern.

The consideration for the acquisitions was in the form of both cash and shares and will result in Marnock issuing a 20 per cent minority interest to Oralcrys LLC – an entity beneficially controlled by the former operator of the businesses.