VM Investments Limited (VMIL) has become the latest listed company to approach its shareholders to lift the upper bounds of total shares that can be issued, a potential precursor to a capital raise.

The 2023 annual report, which was published on Thursday, June 6, had a special resolution for its upcoming hybrid annual general meeting (AGM) to be held at 3 pm on July 4. The resolution seeks to change the authorised share capital to an unlimited amount of shares and give the directors permission to issue preference shares, from time to time, without further reference to members in general meetings.

VMIL’s authorised share capital is currently five billion ordinary shares, and it has 1,500,025,000 ordinary shares in issue. VMIL had its initial public offering (IPO) in December 2017 where it raised a gross amount of $689.26 million.

While it hasn’t raised new capital from ordinary shares since 2017, it received $1.50 billion on October 31 by issuing 1.50 million in non-redeemable, non-cumulative preference shares to its parent company VM Financial Group Limited. It also sold its 30 per cent stake in Carilend to VM Financial Group for US$4.92 million (J$752.90 million) on March 27. VMIL injected $900 million into VM Wealth Management Limited in 2022. VMIL’s board is set to consider an interim dividend on June 18 following its last payment in December 2021.

On the same day (July 4), shareholders of Main Event Entertainment Group Limited will also consider at their AGM a special resolution to increase the authorised share capital to an unlimited amount. This would make way for either a stock split or potential equity raise of up to $396.35 million under the current Junior Market shareholder cap of $500 million. Main Event’s authorised share capital is 320,004,000 ordinary shares which is 19,999,000 ordinary shares above the current issued share count. The AGM is set for 2 pm at the AC Hotel by Marriott.

Stanley Motta Limited will also be considering a resolution at its September 25 AGM to adjust its authorised share capital from 757,870,478 ordinary shares to 1,257,870,478 ordinary shares. Stanley Motta’s authorised share capital is currently 757,828,490 ordinary shares which leaves no room for the company to consider an equity raise without increasing the authorised share capital. Stanley Motta didn’t raise new equity capital in its August 2018 IPO.

The last major company to adjust its share capital limit was Seprod Limited at its September 2023 AGM where it increased its authorised share capital by 220 million ordinary shares to one billion ordinary shares. The resolution also gave the director’s permission to allot the new shares as it deems fit, convert the shares into stock units and list them on the Jamaica Stock Exchange (JSE). Although this isn’t a definitive sign of a capital raise, it could also be a way for Seprod to settle a future deal through consideration of shares rather than using cash.

Innovative Energy Group Limited (formerly Ciboney Group Limited) had its authorised share capital adjusted from 546 million to an unlimited amount at its December 2023 AGM.

EduFocal Limited and MFS Capital Partners Limited received approval from its shareholders at their recent AGMs to execute rights issues which is one form of a secondary capital raise. Tropical Battery Company Limited received approval at its April 2024 AGM to not only execute via a rights issue or additional public offering (APO), but issue 65,627,273 new ordinary shares to persons related to the recent acquisition of Rose Electronics Distributing Company (Rose Batteries).

All of these proposed share capital adjustments and approved equity raises come at a time when raising capital has become a little more difficult amid high interest rates, tight liquidity and moderate inflation. While FosRich Limited was able to raise $139.32 million from its $2.50 renounceable rights issue in August 2023, 138 Student Living Limited (138SL) and NCB Financial Group Limited (NCBFG) were not as successful in their recent APOs.

138SL raised $510.48 million in its October 2023 APO, a fraction of the $2.15 billion target it had sought. NCBFG raised $2.5 billion in its June 2024 APO which was about half of its $5.1 billion target. 138SL’s APO was priced at $4.40 and NCBFG’s APO at $65, both of which are premium prices to Monday’s closing prices of $4.14 and $61.95, respectively. FosRich closed at $2.13 on Monday.

Barita Investments Limited, which attempted to raise $8 billion in a January 2023 private placement bond, didn’t meet its desired expectations back then. It raised $1.507 billion out of the $1.92 billion target it had set for the secured tranche of the bond which closed in February 2023.

The other three unsecured tranches all closed in August 2023 totalling $2.29 billion. Tranche I raised 798.6 million relative to the $2.15 billion target, tranche II raised $346.5 million relative to the US$6-million (J$930-million) target and tranche IV raised $1.14 billion relative to the $3-billion target. Barita received a US$27.2-million (J$4.21-billion) margin loan in September 2023 and repaid it during the first quarter (October to December).

Mayberry Jamaican Equities Limited (MJE) has extended the closing date of its bond by two weeks from June 7 to June 21 and has also upsized the offer to a new maximum target. The bond has three tranches with initial targets of $750 million each which total $2.25 billion with the upsize taking the maximum raise amount to $3.38 billion.