Jamaica’s NCB Financial Group announced yesterday that it is looking to issue up to 300 million new shares in an Additional Public Offering (APO) of shares.
In a notice published on the website of the T&T Stock Exchange yesterday, NCBFG said its board decided at a meeting last Friday, that “an extraordinary general meeting should be held to consider the additional public offering of new ordinary shares and to apply for listing of the shares.”
The NCBFG notice indicated that the number of shares sought to be issued by way of APO was expected to be up to 300 million.
The company said it would, in due course, issue a notice regarding arrangements for the extraordinary general meeting.
NCBFG, which is listed on the T&T and Jamaica stock exchanges, is the majority shareholder of the Westmoorings-based, regional insurer, Guardian Holdings Ltd
NCBFG’s issued share capital is $2,466,762,828. At yesterday’s closing price of TT$3 a share, the financial service group’s market capitalisation was $7.4 billion (US$1.10 billion).
As at June 30, 2023, NCBFG’s largest shareholder was its executive chairman, Michael Lee-Chin, who owned $1,467,645,135 equal to 59.49 per cent of the company, mostly through connected parties.
Lee-Chin’s total shareholding as at June 30 was 38,708,700 shares less than he held as at March 31, 2023.
That confirms he was the seller of 22,708,700 NCBFG shares on June 9 and 16 million shares for the period June 27 to June 29.
According to the West Indies Stockbrokers (WISE) weekly market report, NCBFG declined by 7.69 per cent last week and is down by 34.21 per cent for the period January 1 to September 8, 2023, on the T&T stock market.
Interviewed for The Big Interview, broadcast on CNC3 on June 25, Lee-Chin said he acquired a majority stake in NCBFG in 2002 at an average share price of less than J$4 a share.
“We turned that business around and the NCBFG share price ran up from less than J$4 to over J$200 a share. So you have to keep things in perspective because my average price was less than J$4 a share. So even if I were to sell at J$68 a share, to go from J$4 to J$68 a share in 21 years is a phenomenal return.
“Periodically, not only do I sell shares, I also buy shares, depending on what liquidity I need,” said Lee-Chin.
Asked what signal he was sending to the shareholders of NCBFG by selling 1.5 per cent of his shares in the company, Lee-Chin said: “No signal because I have 98.5 per cent. I may sell more yes and I may buy some more.”
He also said he was selling assets to do two things—to pay down debt and to make other investments.
Asked whether he had a cash flow problem, Lee-Chin said, “We have not had a dividend from NCBFG for over two years and that is being worked on as we speak. If you stop getting income, what you have to do, is you need to make sure that you have other sources of liquidity, which would include selling some assets to make sure you can honour whatever obligations you have and at the same time grow.”
On May 24, the NCBFG chairman announced that he was taking a three-month leave of absence from the boards of NCBFG, National Commercial Bank Jamaica (NCBJ) and GHL “to allow him to focus on certain pressing business and personal matters.”
On July 17, before the end of the three-month leave of absence, NCBFG announced that Lee-Chin’s leave of absence had come to an end.
That was followed the day after by the announcement that the NCBFG CEO and deputy CEO Patrick Hylton and Dennis Cohen had, by agreement, proceeded on vacation leave for three weeks.
APO’s are normally issued to raise capital or to boost the cash reserves of issuing companies.