Proven to raise J$1 billion from pref share issue next month
Proven Investments Limited plans to raise J$1 billion from a preference share issue in December, which will help finance its continued expansion push.
“The shares will be for five years and will be Jamaica dollar, fixed coupon at eight per cent,” Proven’s CEO Chris Williams told Caribbean Business Report. NCB Capital Markets will act as the broker and underwriter of the deal.
The company scheduled an extraordinary meeting for next Wednesday, when shareholders will vote on whether to increase the share capital of the company by 300 million cumulative redeemable preference shares that can be listed on the stock exchange.
Williams said the investment firm plans to use the capital to acquire a financial institution that targets personal loans and loans to small and medium-sized entities (SMEs) and a minority stake in a tourism venture.
“As soon as the memorandum of understanding (on the tourism venture) is signed we will disclose fully,” he said.
Plans are also advanced on the establishment of a real estate investment trust (REIT), which the company plans to seed with its own capital over the next three to five years, after which it intends to “take it to the market”.
“We already have approved some real estate acquisitions, which are so far primarily in Jamaica,” said Williams. “We have very attractive options with existing flows of income.”
The capital will also serve to build up cash to be held in reserve for deals that are not as close to fruition.
Proven posted US$1.97 million ($170 million) in net profit for the six months ending September 30, 2011, representing a 56 per cent decline when compared to the same period last year. However, without the one-off gains from the acquisition of Guardian Asset Management last year being included in the profit and loss, Proven saw a 23 per cent increase in net profit from its core business.
Moreover, Proven has “successfully begun the process of positioning Proven Wealth independent of Proven Investments having recently appointed Chorvelle Johnson as the CEO”, according to Williams.
“She has been going after the very competitive securities dealers market and we expect to continue to market that subsidiary”.
