RA WILLIAMS Distributors Limited’s initial public offering (IPO) closed last Wednesday as scheduled, with investors applying for more than $420 million worth of the company’s shares over three weeks. The company had targeted $400 million.

In its prospectus, RA Williams said the funds will be used for paying down $304.65 million in debt, financing $46.35 million in working capital with the other $49 million going towards other expenses including fees.

Only 52.5 per cent of the total shares on offer was made available to the general public. With the IPO closed, the brokers are now working out how to allocate the shares amongst applicants and the total amount investors should expect in refunds. The basis on which those decisions are made will be published this coming Monday.

“We are deeply humbled by the tremendous support from our investors. We couldn’t have done this without them, and we are now eager to welcome them as part-owners of our company. This successful IPO represents a crucial milestone in RA Williams’ path to long-term growth and expansion. We are now better positioned to scale up our contributions to the improvement of health care in Jamaica, and we know that countless lives will be positively impacted by the ripple effect of this achievement,” said Audley Reid, chief executive office of RA Williams, in a press release.

In the coming days, the company is expected to make an application to the Jamaica Stock Exchange (JSE) to list the shares on the Junior Market. If the JSE’s Listing Committee approves the listing, RA Williams would be the 48th active company on the Junior Market and 105th company on the JSE.

Yet, while lead broker Sagicor Investments Jamaica Limited is celebrating another successful IPO, several capital market leaders have questioned the relatively small oversubscription in comparison to others offers in recent years, some which opened and closed in minutes. RA Williams’ offer was oversubscribed by $20 million, which is 5 per cent higher than the $400 million it sought. It was in the market for three weeks from July 17 to 31. The IPO was restricted to Sagicor’s eInvest online platform.

By comparison, the Omni Industries Limited IPO in May of this year – the last one before RA Williams approached the public for funding – attracted $830 million, 66 per cent more than the $500 million it went to market for with 2,686 persons applying.

In particular, the shares Omni Industries made available to the public was earmarked to raise $120.93 million, but persons poured more than four times that amount into the offer with brokers receiving applications worth $483.73 million. Omni Industries’ offer was scheduled to run for 14 days, from May 17 to 31, but was closed within 5 days of opening. It was the first IPO of 2024 and was only available on NCB Capital Markets Limited’s GOIPO online platform.

Going back to last year, One Great Studio Company Limited’s August 2023 IPO which sought $338.63 million in fresh equity was oversubscribed by 61 per cent, with $545.19 million in subscriptions received for the offer. This offer closed one day after opening. The company gained more than 3,600 new shareholders in that IPO which was available on Barita Investments Limited’ Barita Boss and JMMB’s Moneyline online platform.

The only other public capital market offer in 2024 was NCB Financial Group Limited’s (NCBFG) additional public offering (APO) which garnered $2.48 billion in subscriptions relative to its $5.1-billion target. The APO was open for over a month and had more than seven other brokers, along with NCB Capital Markets selling the shares to the public. There have been other offers raising funds in the capital markets, chiefly debt, with a multi-billion-dollar debt offer by a financial conglomerate closing recently and NCBFG refinancing $15 billion in a new unsecured bond offer.

Sagicor Investments Limited had been on a hiatus for effectively two years in leading an IPO to market with its last offer being One-on-One Educational Services Limited in August 2022. That offer garnered more than $3 billion in subscriptions relative to the IPO’s size of $358.25 million, a 745 per cent oversubscription. The offer closed on the same day it was opened.

In that offer, Sagicor Investments had initially restricted applications to its eInvest platform, but following backlash in the investor community, it relented and added JMMB Securities Limited, Mayberry Investments Limited and NCB Capital Markets Limited (NCBCM) as selling agents. eInvest was taken offline and a new version was relaunched this year for the RA Williams IPO. This comes on the heels of Sagicor Group’s overall digitisation plan.