Connect with us

Businessuite Markets

Cover Story : The Battle for Control of Salada Foods

Published

on

A deal that left more questions than answers

What did Donovan Lewis, Chairman of Three Bears see in Salada Foods that nobody else saw? How about a pre-tax profit of JA$482,906,847.38

The latter part of 2008 saw Christopher Berry, Chairman of Mayberry Investments and Donovan Lewis, Chairman of Three Bears in a one sided battle for control of Salada Foods. What did they see and know that other players in the market didn’t?

On the 15th July 2008, the announcement on the Jamaica Stock Exchange (JSE) website was that “Salada Proposed A Stock Split”. Salada Foods Jamaica Ltd advised that at a meeting of the company’s Board of Directors to be held on July 22, 2008, the directors would be considering a split of the company’s share.

On the 25th of July in 2008, the following was posted on the JSE website “Stock Split-Salada Foods.”

“The Board of Directors of Salada Foods Limited has advised that the Directors have decided on the following matters at its meeting held on July 22, 2008:
a. To increase the number of authorized shares in the company from ten million four hundred thousand to five hundred million ordinary shares of no par value by the creation of four hundred and eighty nine million six hundred thousand new shares of no par value.
b. From the new shares created the company will issue nine new ordinary shares for every one ordinary share currently held by each member of the company.
c. To call an Extraordinary General meeting of the shareholders’ to be held on August 28, 2008, at 3 p.m., at the Hilton Kingston Hotel to put forward the above stated Ordinary resolutions and
d. To put forward at the meeting Special resolution for the adoption of Articles of Incorporation of the company and cancel the existing Articles and Memorandum in substitution therefore. “
There was no indication from this report what the intention of this move might be; was it to increase the company’s share capital to fund projected growth and expansion, or was it designed to raise funds to pay down expensive debt?.

At the time, the company’s stock was trading between JA$130 and JA$135 per unit having started the year at JA$44 and would go as high as JA$150 before the end of the year on very low trading volumes (see table below). It could therefore be assumed that the stock split was designed to allow the shares to trade in smaller denominations thus attracting more investors. But was this the real value of the stock? Or was this the result of rampant speculation driving the price up?

SALADA MONTHLY
TRADING VOLUMES 2008

Jan 1,899,214
Feb 90,822
Mar 67,615
Apr 14,014
May 29,386
Jun 850
Jul 3,620
Aug 1,149
Sept 1,235
Oct 1,175
Nov 30,150
Dec 94,500

Did the volume of stock trades warrant this kind of move in the stock price? One could hardly take these low levels of trades as a serious bid to wrestle and secure control. Still, more unanswered questions.

What did Salada have to offer?

For the financial period ending September 30th 2008, Salada posted revenues of $393.8M an increase of $51.1M or 14.9% over 2007. Profit before tax was $114.0M compared to $102.6 for the corresponding period in 2007. Net profit attributable to shareholders was $75.3M compared to $68.2M. Earnings per share (EPS) was $7.25 compared to $6.56.

“I can’t think of anything special or specific at the time that would warrant a stock price war and battle for control of Salada foods, other than a good brand name and reasonable good export growth prospects I don’t see much else”, according to one financial analyst when asked the question. That also seemed to be the perspective of a number of other industry watchers. So what really was it? What did Chris Berry and Donovan Lewis, the two players battling for control, see and know that other players in the market didn’t know and could not see? Was this much ado about nothing or was there really something there? Could it be that there was collusion to drive the stock price up?

One senior business executive suggested that Mayberry’s attempt to secure control by offering $32.50 per share for 51 per cent of the coffee company’s near 10.4 million issued shares was not realistic, as Donovan Lewis controlled just over 60 per cent of Salada, and was not likely to sell to Mayberry to give them the desired control.

So, when Mayberry announced a hostile bid for Salada Foods, at $32.50 per share for 51 per cent of the coffee company’s near 10.4 million issued ordinary shares, investors started to take notice. The offer opened on August 30th and closed September 28th last year. At the time, there were 10,388,320 Salada shares outstanding, which would put Mayberry’s cash offer at approximately J$172.2 million.

The Mayberry bid rivalled that of the August 17th 2008 Donovan Lewis-controlled Three Bears’ offer of $25.82 per share for the remaining 39.77 percent of ordinary stock units in Salada. Mayberry said its cash offer had long-term benefits for the company, including profitability growth potential.

There was, as would be expected, varying views by analysts on the offers. According to one published view, “The move to acquire a 51 per cent shareholding in Salada might be an attempt by Mayberry to prevent Three Bears from increasing its shareholding in Salada by as much as 80 per cent and subsequently delisting the company”. However published statements attributed to Donovan Lewis confirmed that he had no intentions of delisting the company, and was only responding to take-over rules triggered by his current holdings. Others felt it could diversify Mayberry’s business and boost Salada’s share price.

Three Bears, which is based in the British Virgin Islands, surpassed the 50 per cent threshold to trigger a mandatory take-over bid when Lewis or companies controlled by him acquired Three Bears from the Caribbean Investment Fund (CIF) at the end of 2006.

The deal gave Three Bears 2,052,000 ordinary stock units in Salada. Lewis, through Three Bears, subsequently purchased a further 2,018,981, ordinary Salada stock units from the CIF. The combined acquisitions gave Three Bears 60.23 per cent ownership of Salada.

Chief Executive Officer of Mayberry, Gary Peart, in published media reports last year was quoted as saying that “his (Mayberry) firm was prepared to offer more than Three Bears as it believes the acquisition of shares in Salada has sound, long-term benefits.”

“We are prepared to offer close to 26 per cent ($6.68) above the Three Bears’ take-over offer because we believe that the acquisition of shares in Salada has sound, long-term benefit. Salada presents the profile and profitability growth potential that we look for in companies to include in our acquisition strategy going forward, though it’s continuing profitability is not a certainty,” Peart also said.

It’s interesting to note that both bids were significantly below Salada’s then market price of $45.

This begged answers to the following questions.

What triggered the stock movement to 45 dollars per share?

Why were the offer prices for the stock below 45, hovering now between JA$26 and JA$32.5 dollars?

What’s the real value of a Salada stock?

And so a bidding war was on for controlling interest in Salada Foods, and as one analyst said, “it could be that Mayberry is banking on the fact that any price below 45 is a good buy and with an expectation that the price may move back up they will be guaranteed a handsome profit on the deal. And with a bidding war now in play with Three Bears, chances are that the prices will begin to move again. So it appears no matter what Mayberry and Three Bears do by virtue of their actions, each may just get the price movement they seek.”


So was the Salada takeover battle an exercise in futility?

“I have over 60 per cent of the shares and I’m not selling. Is he (Chris Berry) really serious?” commented Donovan Lewis, Chairman Three Bears Limited.

The buzz around Salada pushed the stock price to JA$70 per share and in the face of a clear and unequivocal rejection of an offer to buy controlling interest from Donovan Lewis, Chris Berry’s Mayberry Investments was still pushing. The only question to be answered was why?

Given that Donavan Lewis acquired the stock at $25.82 or $161.5m in total value, this represented a whopping $277m gain in less than ten months. Chris Berry did not do too badly either. Mayberry Investments’ 0.3 per cent share holdings made roughly $1.4 million based on the stock price. Investment managers were reported to be saying at the time that the stock price might even climb further to $80.

The Salada Board subsequently announced that Mayberry had served a written notice upon the Company increasing its take-over bid price from J$32.50 per stock unit to J$40.08 per stock unit. The new price valued the Mayberry bid at $212 million. In response, the coffee company called an urgent meeting of its Board of Directors on September 19, 2008 to consider the Mayberry increased offer.

Mayberry’s move was ahead of the Board’s recommendation that shareholders reject the original bid in August of $172 million, or $32.50 per share, to gain fifty-one per cent (51%) of Salada, rivalling the mandatory bid of $25.82 made by controlling shareholder, Donovan Lewis’ Three Bears. The Salada Board said it had undervalued the holdings. At $70 per share, Salada was valued at $727.2 million ($70 times 10,388,330 stock units in issue). At that price, Mayberry’s holding, a negligible 31,250 units or 0.3 per cent of the Company was worth $2.2m; while Three Bears, which owns 60.23 per cent of Salada or 6,256,891 units, was worth $438m.

Not selling

To secure its targeted 51 per cent bid, Mayberry would have to woo Three Bears to sell some of its holdings. Lewis however is reported to have again said that he would not sell neither would he improve his offer, calling the Mayberry offer a futile exercise. “I don’t know what they are trying to do; that doesn’t make sense,” he said. “I have over 60 per cent of the shares and I’m not selling. Is he really serious?”

Mayberry however remained undaunted indicating that it saw value in the stock and that responses to the offer had been fair so far, indicating that the price offer was a result of Mayberry’s re-evaluation of the stock.

Lewis said that even at the new price, Mayberry’s rival offer could not succeed. He said that, “no one at the company had approached him to sell and that the new $40.08 offer was neither worth the time nor the effort.”

However, Peart said Salada is an illiquid stock and that the price could jump significantly either way. He argued that a lot of shareholders had already taken up the offer saying they had been trying to sell their shares for years but could not find buyers.

As 2008 came to a close, Salada stock price reached as high as JA$150 per unit, driven largely by speculations. The Directors of Salada Foods subsequently advised that they would do a stock split and shareholders were to receive a ten to one offer, consistent with the resolutions put forward at the Extraordinary General Meeting.
With the stock price at JA$150 per share, the value of Donovan Lewis’ share holding in the company moved from JA$161,552,925 to JA$644,459,773, a gain of JA$482,906,847. Mayberry’s investments now had a pre-tax profit of JA$2,411,875.
Was this the end game? Your guess is as good as mine.

Additional Sources: Jamaica Gleaner, Jamaica Observer, Jamaica Stock Exchange, Internet sources

Businessuite Markets

Scotiabank Group Jamaica Continues To Perform Well

Published

on

Scotia Group reports net income of $4.2 billion for the quarter ended January 31, 2025, representing an increase of $1.1 billion or 34.5% over the comparative prior period.

The Group’s asset base grew by $73.3 billion or 11% to $739.2 billion as at January 2025 and was underpinned by the excellent performance of our loan and investment portfolios.

In furtherance of our objective to continue to return value to our shareholders, the Board of Directors has approved a dividend of 45 cents per stock unit in respect of the first quarter, which is payable on April 17, 2025, to stockholders on record as at March 26, 2025.

Audrey Tugwell Henry, Scotia Group’s President and CEO gave the following comments. “Scotia Group has delivered another solid performance for the quarter, and I am very proud of our team for their unwavering dedication and consistent service delivery to our clients. These results signal a strong start to the second year of our five-year strategy, and our goal remains to become our client’s most trusted financial partner. We continue to promote the importance of a balanced financial portfolio which incorporates banking, insurance protection and wealth, and we are committed to offering the best financial advice, earning the right to be our clients’ primary financial institution and making it easier to do business with us.”

Business Performance

Scotiabank Continues To Perform Well With Each Business Unit Delivering Commendable Results For The Quarter.

Deposits by the public increased by $34.4 billion or 7.5% versus the corresponding period last year.

Total loans increased from $275.7 billion to $312.5 billion representing an increase of 13.3%. This includes a 12% increase in Scotia Plan personal banking loans and a 24% increase in mortgage loans. Commercial loans also increased by 5% over the prior year period.

Our insurance subsidiaries continue to make a valuable contribution to the Group’s results. Net Insurance Revenues at Scotia Insurance increased by $504 million or 96% year over year and Gross Written Premiums grew by 5%. Sales at our general insurance business, Scotia Protect, increased by 53% while Gross Written Premiums increased by 71% when compared to the previous period.

Scotia Investments continues to assist clients to build wealth and navigate the complexities of the financial markets. Assets Under Management at SIJL increased by 13.3% over the comparative period demonstrating the strength of our investment advisors and asset management team.

As we advance our growth strategy, we are very pleased to see the continued appreciation in our stock price which has shown steady improvement. This demonstrates significant investor confidence in the Group and we are proud to continue returning strong value to our shareholders through both consistent dividend payments as well as capital appreciation.

Group Financial Performance

Total Revenues

Total revenues excluding expected credit losses for the year ended January 31, 2025, grew by $2.2 billion to $17.1 billion reflecting an increase of 14.9% over the prior year period. This was primarily driven by the strong growth in our loan portfolio which led to an increase in net interest income of $1.1 billion or 10% as well as an increase in other revenue of 26.2%.

Other Expenses

Other income, defined as all revenue other than interest income, increased by $1.2 billion or 26.2%.
• Net fee and commission income for the period amounted to $2.2 Billion and showed an increase of $671.8 million or 42.9% and was primarily driven by the higher volume of client transactions and activities.
• Net insurance revenue increased by $503.8 million or 96.2%, driven by higher contractual service margin releases coupled with lower insurance expenses in keeping with the performance of the portfolio, as well as an increase in transaction volumes stemming from further deepening of our client relationships.
• Net gains on financial assets amounted to $197.2 million, reflecting a year over year increase of $67 million or 51.5%, given improved market performance. 5 OPERATING

Expenses

Operating expenses totaled $9.7 billion as at January 2025 and reflected an increase of $1 billion or 11.6% when compared to the prior period. Of note, annual asset taxes recorded during the quarter totaled $1.7 billion, an increase over 2024 of $102 million or 6.4%.

Excluding the reduction in the net pension credit on our defined benefit plans, operating expenses increased by $743 million or 8.1% year over year.

Additionally, our investments in technology also contributed to the increase in operating expenses, as the Group continues to expand on our digital capabilities geared towards simplifying and streamlining our processes to make it easier for our clients to do business with us. These investments have enhanced the overall efficiency of our operations and enabled us to generate increased revenues.

Capital

Shareholders’ equity available to common shareholders totaled $150.7 billion and reflected an increase of $29.3 billion or 24.1% when compared to January 2024. This was due primarily to the re-measurement of the defined benefit pension plan assets, higher fair value gains on the investment portfolio and higher internally generated profits partially offset by dividends paid.

We continue to exceed regulatory capital requirements in all our business lines, and our strong capital position also enables us to manage increased capital adequacy requirements in the future and take advantage of growth opportunities.

Audrey Tugwell Henry, Scotia Group’s President and CEO

For More Information Click Here

Continue Reading

Businessuite Markets

The LAB’s Strategic Shift: Embracing Content Creation Amidst Evolving Financial Landscape

Published

on

Limners and Bards Limited (The LAB) headed by Kimala Bennett Chief Executive Officer, has unveiled its unaudited financial statements for the first quarter ending January 31, 2025, showcasing a nuanced performance as the company navigates a strategic pivot towards content creation. This move aims to capitalize on the burgeoning global appetite for diverse, high-quality content.

Financial Performance Overview

The LAB reported a robust quarterly revenue of $286.1 million, marking a significant 30.4% year-over-year increase. This growth was primarily driven by gains in the Production and Media segments. Gross profit reached $100.5 million, a 13% uptick from the previous year, indicating sustained operational efficiency.

However, profit before tax experienced a slight decline of 3.6%, settling at $25.2 million. This downturn is attributed to the transition from a full income tax holiday to a 50% concession, following The LAB’s fifth year on the Junior Stock Exchange. Consequently, net profit for the period stood at $21.6 million, reflecting a 17.6% decrease compared to the prior year. Despite this, the company maintains a robust balance sheet and a stable cash position.

Segment Performance

Media: Generated $142.5 million in revenue.

Production: Contributed $101.0 million.

Agency: Accounted for $42.6 million.

The net profit margin declined by 5.4%, as revenue growth was led by the lower-margin Production and Media segments, compared to the higher-margin Agency segment in the prior period. The company anticipates an Agency rebound by Q3, aligning with industry’s seasonal fluctuations.

Strategic Investments and Asset Growth

The LAB’s asset base expanded by $178.0 million, driven by strategic investments in content development. This initiative positions the company for long-term growth and revenue diversification in the “Owned” content industry.

Current assets rose to $920.6 million, while cash and cash equivalents experienced a year-over-year decline of $89.2 million.

Accounts receivable increased by $118 million, mirroring strong revenue growth. Management remains focused on optimizing credit terms through active client engagement.

Shareholders’ equity strengthened to $660.1 million, a 5.8% increase from the prior year, underscoring the company’s financial resilience.

Transition Towards Content Creation

The LAB is strategically positioning itself to harness the escalating global demand for diverse and high-quality content. With major streaming platforms, including Netflix, projected to invest $18 billion in content in 2025—an 11% increase from 2024—the appetite for fresh storytelling is evident.

The company’s “FIVE in 25” initiative, aiming to produce five films by 2025, is progressing well. Two films have been completed, with active negotiations underway with buyers and distributors. By focusing on high-performing genres such as Christmas and romance, The LAB ensures its productions cater to proven audience preferences.

Industry Outlook and Viability

The global content market is experiencing unprecedented growth. Streaming services and traditional distributors are increasingly seeking diverse narratives that resonate with a global audience. This trend presents a significant opportunity for The LAB, as its productions offer unique Jamaican perspectives with universal appeal. Engagements at international events like NATPE Global 2025 have facilitated negotiations with major distributors and networks, enhancing the company’s visibility and positioning its films for broader distribution.

Implications for Shareholders and Investors

While the strategic shift towards content creation entails upfront investments and a gestation period before realizing returns, it aligns with global industry trends favoring diverse content. The LAB’s strong financial foundation, coupled with its proactive approach to content development and strategic partnerships, suggests a forward-thinking trajectory. Shareholders and investors can anticipate potential long-term gains as the company taps into new revenue streams within the expanding content market.

Conclusion

The LAB’s recent financial performance reflects the complexities of transitioning within a dynamic industry landscape. By embracing content creation and investing in strategic initiatives, the company demonstrates adaptability and a commitment to sustainable growth. As The LAB continues to evolve, its focus on delivering compelling, culturally rich content positions it to capitalize on emerging opportunities, promising value creation for shareholders and stakeholders alike.

For More Information CLICK HERE

Continue Reading

Businessuite Markets

Jamaica Broilers Group Faces Major Financial Setback as US Operations Struggle; Stephen Levy Resigns

In a move that signals accountability at the highest level, Mr. Stephen Levy, President of JBG’s US Operations, has resigned from both the Board and the Company, effective May 3, 2025. Levy, who has been with Jamaica Broilers since 2002, played a pivotal role in growing the US segment’s annual revenue from a modest US$10 million to over US$250 million. His departure suggests he is taking responsibility for the recent poor financial results of the US operations.

Published

on

The Jamaica Broilers Group Limited (JBG) has reported a major financial shift for the quarter ending January 25, 2025, revealing a dramatic swing from profitability to loss. The company’s unaudited financial statements highlight a net loss of $1.1 billion for the current quarter, a stark contrast to the net profit of $1.3 billion reported in the corresponding period last year. This represents a significant $2.4 billion downturn in financial performance, prompting serious concerns about the group’s operational and financial stability, particularly in its US segment.

Revenue Growth Overshadowed by Rising Costs

Despite the overall revenue of the group increasing by 5% to $24.6 billion, up from $23.6 billion in the previous year, profitability has suffered significantly. Gross profit for the current quarter stands at $4.7 billion, marking a 21% decline from the $5.95 billion recorded in the same period last year. This discrepancy suggests that the cost of goods sold or other direct expenses have outpaced revenue growth, eroding the company’s margins.

Jamaican Operations: Hurricane Beryl’s Impact

Jamaica Broilers’ domestic operations also faced difficulties, with segment profits declining by 9%—from $5.964 billion last year to $5.4 billion this quarter. While total revenue for the Jamaican segment saw a marginal 0.5% increase over the prior nine-month period, the impact of Hurricane Beryl significantly affected profitability. Increased operational costs due to hurricane-related disruptions appear to be the primary reason for the decline, signaling vulnerability to environmental and economic shocks.

US Operations in Crisis: A Steep Decline

In a move that signals accountability at the highest level, Mr. Stephen Levy, President of JBG’s US Operations, has resigned from both the Board and the Company, effective May 3, 2025.

The most alarming financial downturn occurred in JBG’s US operations. The segment reported a profit of just $922 million this period, a sharp 69% decline from the $2.192 billion earned in the corresponding period last year—a staggering $2.1 billion shortfall. Notably, revenue for the US segment grew by 5%, indicating that the decline in profit is not due to a drop in sales but rather significant increases in operational expenses, lower profit margins, or one-time extraordinary costs.

Several factors have been identified as contributing to the decline in US operations:

Expense Management Issues: Ineffective cost controls have led to higher-than-expected spending.

Operational Control Deficiencies: Weaknesses in internal procedures may have resulted in inefficiencies and potential losses.

Hurricane Flooding Challenges: External disruptions due to severe weather conditions likely compounded the operational difficulties.

The combined effect of these challenges led to the substantial decrease in US segment profitability, raising concerns about long-term sustainability and resilience.

Corporate Response and Leadership Changes

Recognizing the gravity of the situation, JBG’s corporate management has taken decisive steps to address the financial downturn. The company has engaged external advisors to assess the issues and provide expert recommendations for corrective action. Additionally, JBG is undertaking a thorough review of operational controls to identify weaknesses and implement necessary reforms.

In a move that signals accountability at the highest level, Mr. Stephen Levy, President of JBG’s US Operations, has resigned from both the Board and the Company, effective May 3, 2025. Levy, who has been with Jamaica Broilers since 2002, played a pivotal role in growing the US segment’s annual revenue from a modest US$10 million to over US$250 million. His departure suggests he is taking responsibility for the recent poor financial results of the US operations.

During this transitional period, JBG President & CEO, Mr. Christopher Levy, will oversee US operations directly, ensuring that necessary corrective measures are implemented to restore profitability and operational efficiency.

During this transitional period, JBG President & CEO, Mr. Christopher Levy, will oversee US operations directly, ensuring that necessary corrective measures are implemented to restore profitability and operational efficiency.

Looking Ahead: The Road to Recovery

Jamaica Broilers Group now faces the challenge of stabilizing its US operations while reinforcing its financial health. The company’s commitment to engaging external expertise and reassessing operational frameworks suggests a strong intent to rectify existing issues. However, investors and stakeholders will closely monitor how effectively JBG can execute these turnaround efforts.

While the departure of Stephen Levy marks the end of an era for JBG’s US segment, it also signals a crucial moment of introspection and course correction for the group. The next few quarters will be critical in determining whether JBG can regain financial stability and rebuild investor confidence in its future prospects.

For More Information  CLICK HERE

Continue Reading

Businessuite Markets

Listing GraceKennedy Financial Group on the JSE

The acquisition and delisting of Key Insurance and the potential listing of GraceKennedy Financial Group on the JSE represent a transformative strategy. This approach not only streamlines the group’s organizational structure but also positions it to capitalize on emerging opportunities in the financial services industry, ultimately driving value for customers and shareholders alike.

Published

on

GraceKennedy Financial Group’s (GKFG) recent J$403.71 million bid to acquire the remaining 27% of Key Insurance Company Limited (Key) presents a pivotal opportunity for strategic restructuring within the GraceKennedy conglomerate.

Currently holding approximately 73% of Key’s shares, GKFG’s move towards full ownership could lead to significant organizational changes, including the potential delisting of Key from the Jamaica Stock Exchange (JSE) and the subsequent listing of GKFG.

Delisting Key Insurance from the JSE

Under the JSE Main Market rules, a company may be delisted if a single shareholder controls more than 80% of its listed shares . Should GKFG’s acquisition increase its stake in Key beyond this threshold, delisting becomes a probable outcome. This would allow GraceKennedy to integrate Key’s operations more seamlessly into its financial services division, enhancing operational efficiencies and strategic alignment.

 

Listing GraceKennedy Financial Group on the JSE

Introducing GKFG as a listed entity on the JSE’s Main Market could offer several strategic advantages:

Consolidation of Financial Services: Listing GKFG would enable the consolidation of GraceKennedy’s insurance, banking, and financial subsidiaries under a single holding company. This unified structure could streamline operations, reduce redundancies, and present a cohesive financial services portfolio to investors.

Enhanced Capital Raising Opportunities: As a publicly listed entity, GKFG would have direct access to equity markets, facilitating capital raising for expansion initiatives, strategic acquisitions, and technological investments. This access is crucial for staying competitive in the rapidly evolving financial services sector.

Increased Market Visibility and Investor Confidence: A publicly traded GKFG would likely attract a broader investor base, enhancing market visibility. Transparency associated with public listings can bolster investor confidence, potentially leading to a higher valuation and increased shareholder value.

Strategic Implications and Future Outlook

The potential restructuring aligns with GraceKennedy’s long-term vision of becoming a global consumer group by 2030, focusing on both food and financial services . By fully integrating Key Insurance into GKFG and positioning GKFG as a listed entity, GraceKennedy can leverage synergies across its financial services, drive innovation, and enhance customer offerings.

Moreover, this move could set a precedent for other conglomerates in the Caribbean, demonstrating the benefits of strategic realignment and market repositioning to achieve growth and operational excellence.

In conclusion, the acquisition and delisting of Key Insurance and the potential listing of GraceKennedy Financial Group on the JSE represent a transformative strategy. This approach not only streamlines the group’s organizational structure but also positions it to capitalize on emerging opportunities in the financial services industry, ultimately driving value for customers and shareholders alike.

Continue Reading

Businessuite Markets

GraceKennedy Financial Group Moves to Fully Acquire Key Insurance

Published

on

GraceKennedy Financial Group (GKFG), the financial services division of GraceKennedy Limited (GK), has announced a J$403.71 million takeover bid to acquire the remaining 27% of Key Insurance Company Limited (Key). This strategic move reinforces GKFG’s commitment to expanding its presence in the general insurance market while driving growth and value for customers and shareholders.

GKFG, which currently holds approximately 73% of Key’s shares, is offering J$2.70 per share. The offer opens on March 24, 2025, and closes on April 22, 2025. Deputy CEO of GKFG, Steven Whittingham, who oversees GK’s insurance segment, highlighted the benefits of the acquisition, “This transaction aligns with GK’s strategy of unlocking value in the general insurance sector. By fully incorporating Key into GKFG, we can enhance efficiencies and strengthen our competitive position. Our focus remains on innovation, customer satisfaction, long-term stability, and delivering superior products and services.”

Grace Burnett, CEO of GKFG, emphasized GK’s longstanding commitment to general insurance, “GK has been serving general insurance customers for over 50 years. Since acquiring a majority stake in Key Insurance in 2020, we have significantly strengthened its operations and expanded its market reach. Key marked its 40th anniversary in 2022 and has built a reputation for reliability and excellence over the decades. We are dedicated to preserving that legacy while driving future growth for the business.”

GraceKennedy Group CEO, Frank James, noted that the move supports GK’s Vision, which includes a focus on expanding and enhancing the Group’s financial services and delivering strong shareholder returns.

“GKFG’s bid to acquire full ownership of Key underscores GK’s commitment to maximizing stakeholder value. The transaction is expected to unlock operational efficiencies, drive synergies, and enhance customer service, solidifying Key Insurance’s role within our Group.”

Key Insurance is currently listed on the Main Market of the Jamaica Stock Exchange (JSE).

Continue Reading

Trending

0
Would love your thoughts, please comment.x
()
x