Electrical, solar and lighting company FosRich is not ready to approach the equities market to fund its elaborate expansion plans, which includes a diversification of the business.
Managing Director Cecil Foster has disclosed that all the expansion projects now being rolled out such as its massive corporate office, distribution centre and retail space on Molynes Road; PVC pipe manufacturing plant and its transformer repair business, both located in Hayes, Clarendon, are all fully funded. Quizzed at a recent Jamaica Observer Business Forum whether FosRich would be floating an additional public offering (APO) of shares to fund its expansion plans, Foster responded, “Not at this time.”
“All of what we have announced today to you are already funded; funds are already in place for that going forward. Our 2026 plans, which kicks off next year, we will look in the next quarter, where we gonna fund these things going forward and so we are pretty OK with what we have outlined as projects that they are funded already,” Foster advised.
Looking at 2021, Foster disclosed that .
SCALING UP THE TRANSFORMER REPAIR BUSINESS
He said the transformer repair business, which started last year and which is being scaled up, is expected to contribute between eight to nine per cent of that incremental revenue increase. FosRich, which is the sole local repairer of Jamaica Public Service (JPS) transformers, is planning to scale up the business, looking at servicing the Caribbean market.
We pressed Foster to identify the Caribbean markets that FosRich is targeting, but he evaded giving a direct answer, stating, “we will talk about that soon”. He made mentioned of the PVC pipe manufacturing plant in Clarendon, where the company is about to roll out phase two, having started phase one, which is the production and manufacturing of PVC pipes.
In phase two, FosRich will be producing SDR pipes and pipe fittings such as elbows, couplings, “Ts” caps. He indicated that the production of elbows and fitting should start as early as next month and should be up and running with the production of SDR pipes after the third quarter.
FOSRICH NEW COMPANY, BLUE EMERALD LIMITED
The production and manufacturing of the PVC pipes and the transformer repair business in Clarendon are being carried out through a new company formed last year by FosRich called Blue Emerald Limited, which is seeking to be registered under the Special Economic Zone Authority.
This is being done to take advantage of the significant long-term tax concessions that are available under this new regime, which replaces free zone operations. The new company has taken charge of FosRich’s recently built 120,000-square-foot Hayes facility in Clarendon, costing over $100 million.
Blue Emerald will act exclusively for FosRich under a contract manufacturing arrangement which the company carries out on behalf of FosRich electrical repair and PVC manufacturing and distribution. Blue Emerald is charged with the responsibility for repairing JPS transformers at the Hayes facility under a four-year renewable contract that FosRich signed last year with Jamaica’s light and power company.