Fontana shares will list on the Junior Market of the Jamaica Stock Exchange and will commence trading on Tuesday.
The shares that were well sort after will be in high demand with the price expected to jump sharply in a few days. A number of investors in the stock are not pleased that the company varied the terms of the allocation of shares to persons in the general pool from the stated treatments included in the prospectus that stated that multiple applications would be merged and treated as one.
Scotia Investments advised that they are currently in the process of disbursing refunds to applicants via transfers to each broker for their clients and expects to complete the majority of refunds during the week of January 7th.
The share issue attracted 2,770 applicants for shares in the company. Fontana brings to 38, companies listed on the Junior Market. In December, Eppley that was listed on the Junior Market moved over to the main market.
Fontana lists today
Fontana listing on Tuesday
Fresh from a successful initial public offering of 250 million shares, Fontana is not expected to start trading until early January on the Junior Market of the Jamaica Stock Exchange.
Scotia Investments, the brokers for the offer stated that the offer of Two Hundred and Forty Nine Million Eight Hundred and Seventy Four Thousand Nine Hundred and Sixty Five (249,874,965) ordinary shares opened and closed on Thursday, December 13 and attracted a total of 3,406 applications for a total of 982,194,569 shares.
Applications for the Public Pool received the first 25,000 units applied for, with amounts in excess of 25,000 units allocated approximately 8.82 percent.
The brokers indicated that multiple applications from a single person or entity were removed, except where they were entitled to apply for shares in a reserved and the public pool. Once that process was completed, 2,770 applications remained for 944,150,335 shares.
SIJL advised that the methodology and allotment of the shares as follows: Employee Gift, Company Reserved and Key Customers & Doctors pools applicants were fully allocated. Strategic Partners were received a minimum of 50% of the amounts applied for.
Fontana shares, will only be allowed to trade up to a maximum of $2.44 on the first day of trading or a maximum of 30 percent above the $1.88 the public bought the shares at. Thereafter, the maximum price will be dependent on the highest closing bid at the end of the previous day.
The Company recorded revenues of $3.4 billion in the financial year 2018, representing an increase of $272 million or 8.66 percent over the prior year and an increase of approximately 91 percent from $1.76 billion in 2014. Pretax profit for 2018 declined 6 percent from $322 million in 2017 to $303 million after rising from $237 million in 2016 that was up more than 100 percent over the 2015 profit of $115 million. The slowdown in 2018 is attributed to the state of emergency in Montego Bay and road construction in the Barbican area.
Fontana, is projected to earn around 35 cents for the current fiscal year and that should place the price at just over $5 during the course of the year.
Trading gains for Trinidad stocks
At close of the market, the Composite Index fell 0.27 points to 1,306.03, the All T&T Index lost 0.59 points to 1,708.47, while the Cross Listed Index gained 0.01 points to close at 122.09.
Trading ended with 548,561 units valued at $3,807,515 and included CinemaOne that traded for the first time in the SME sector, compared to 64,237 units valued at $1,038,842 on Friday.
IC bid-offer Indicator|The Investor’s Choice bid-offer ended with 2 stocks with the bid higher than the last selling price and 2 with lower offers.
Stocks closing with gains| Angostura Holdings gained 25 cents to close at $16.25, with 19,300 stock units changing hands. Clico Investments ended trading of 97 stock units after rising 16 cents to end at $20.16, National Enterprises added 1 cent and ended at $8.01, with 87,938 stock units changing hands and West Indian Tobacco gained 15 cents and ended at $95.40, with 510 stock units changing hands.
Stocks closing with losses| Guardian Holdings lost 50 cents and completed trading of 8,195 units at $18.50 and Trinidad & Tobago NGL lost 5 cents and completed trading at $29.10, with 22,400 units.
Stocks trading firm| Calypso Macro Index Fund ended trading of 3,320 shares to close at $15, newly listed Cinemaone, traded for the first time since listing on the Small securities market with 200 shares exchanging hands at $10. First Citizens settled at $34, after exchanging 1,772 shares, JMMB Group concluded trading at $1.75, after exchanging 378,037 shares, Massy Holdings closed at $47, after exchanging 11,909 shares, NCB Financial Group settled at $8.55, after exchanging 7,333 shares. One Caribbean Media ended at $10.25, after exchanging 500 shares, Republic Financial Holdings settled at $107.26, after exchanging 4,790 shares, Sagicor Financial exchanged 2,210 shares to end at $9, Scotiabank ended at $64, with 40 stock units changing hands and Unilever Caribbean closed at $23, after exchanging 10 shares.
Prices of securities trading for the day are those at which the last trade took place.
Sterling comments on rights issue
1. SIL shareholders have known about the upcoming rights issue for over 3 months, the longest notice given by any company in the last 2 years!
2. SIL shareholders voted at an EGM on October 8, 2018 to conduct a rights issue. All shareholders, large and small, had a chance to physically attend the meeting and vote on the resolutions proposed. The Board welcomed the decision of the shareholders to do the rights issue and take advantage of great investment opportunities available in the global marketplace!
3. On December 12, the company published the details of the rights issue on the JSE website and the allotment formula for all shareholders. The notice informed shareholders that they would be able to purchase 2 shares for every 3 shares they owned. It also stated that the rights would apply to all shareholders that owned shares as at December 27, 2018. We received many calls from excited shareholders who wanted to participate!
4. SIL placed 2 full page advertisements in the newspaper to remind shareholders: On December 27, 2018 Sterling Investments Limited placed an ad in the Gleaner advising shareholders that the information was available on the JSE website, the SIL website.
5. On January 3, 2018 the JCSD mailed letters to shareholders with the forms they needed to complete. These forms are also available on the JSE website. Some shareholders have confirmed receipt of the documents and some shareholders may not have received them yet due to delays in the local postal service.
6. Sterling Investments remains committed to ensuring all shareholders are given equal and sufficient opportunity to participate in this great investment company. Existing SIL Shareholders will have until January 18th 2019 to renunciate their rights and can apply for shares in the excess pool until January 25th.
7. We are grateful to IC Insider.com for their shareholder advocacy.
Publishers’ comments: thansk for the feedback. While SIL took steps to inform shareholders it does not chnage the facts that the information that was mailed, was sent out late and had critical pages missing or pages with only partial information thereon.
Record new JSE listings for 2019
This year could be a busy one for Initial public offers (IPOS) and record new listings on The Jamaica Stock Exchange (JSE), giving investors many more choices for placing their money.
Nine IPOs came to the market in 2018 with three in December, giving investors more investment choices than in 2017. For 2019, ICreate will be the first IPO out of the block. The government owned Wigton Wind Farm’s IPO will be launched early 2019, probably by March, but it is not one for all investors, in spite of what some politicians would want to see happening. IC Insider.com gathers others to come include, a central Jamaica Manufacturing entity with strong export base, a large paint company and one in the BPO sector. In addition, IC Insider.com gathers that there are at least another three IPOs, should definitely make it to the market this year.
The JSE is projecting for 21 new listing in the current year, Marlene Street Forrest, General Managing Director, informed IC Insider.com recently.
“The main market expects 10 of the total and the Junior Market 11. The list includes both ordinary and preference shares”, Street Forrest stated.
Another stock exchange fiasco
The Jamaica Central Securities Depository (JCSD) finds itself in another fiasco regarding the issue of new shares, following the mess up of the recent Seprod share issue where amounts originally allocated to investors were changed.
The latest mess is the documentation and their dispatch for the rights issue of Sterling Investments shares. The notice for the issue that opened on January 4 and closes on January 11, was only posted on January 3, clearly late for some investors.
The lateness of course is a problem the company could easily fix by extending the deadline date. So far, no official position to extend the deadline date, has been taken. The latest bit of information reaching IC Insider.com, suggests that the date will have to be pushed back.
Two documents were sent to shareholders. A cover letter, describing the issue and mentioning that shareholders can apply for excess shares over their allotment. The application forms sent did not include the page for shareholders to
apply for excess shares (page 4). That of course is not the only problem with the forms. In addition, part of page 1 with instructions is missing, also cut off are sections of pages 2 and 5. In short, the application forms included reflects a level of sloppiness in its execution and does not reflect well on those responsible for the job.
It unclear how the company and the JCSD will deal with the matter, but it appears that the proper way would be the sending of the corrected forms to shareholders and extend the deadline date.
The capital market needs to clean up its act if it is not loose credibility.