Arthur Lok Jack’

NCB has Guardian in the bag

NCB Financial offer to acquire up 62 percent of Guardian Holdings is assured to receive offers that will take them over the 50 percent mark to 52 percent.
Two directors have confirmed to the company’s board with just over 21 percent of the shares state that they have or intend to accept the offer that closes on January 12.
According to the Guardian directors in their comments on the offer, “as at the present time, after reasonable enquiry, the following Directors and senior Officers referred have indicated that they have accepted or intend to accept the Offer.”
The directors’ recommendation document shows that, Arthur Lok Jack owns 25,401,926 or 10.95 percent of the group’s shares, Nicholas Lok Jack 30,957 shares, Imtiaz Ahamad owns 30,957 units directly and indirectly 25,216,319 or 10.88 percent and Henry Peter Ganteaume who indicated he intends to tender up to 140,000 shares. NCB Financial Group already owns 29.99 percent and with the above commitment will end up with a least 52 percent of the company and would only require another 10 percent to get them to the level they aim for.

Guardian Holding

The Board has noted that the intention is to create “a truly Pan-Caribbean, diversified financial services conglomerate” and the business strategy underlying same and has concluded that the Offer is in the best interests of the Company, as it should benefit GHL in the following ways: enhanced market access in the Northern Caribbean and elsewhere. Improved access to capital will allow GHL to pursue more vigorously than in the recent past inorganic growth opportunities. Extraction of cost synergies across the group will have a favourable impact upon future profitability.
The directors’ report states that the Offer and Take-Over Bid Circular shows the valuation of the shares performed by Ernst and Young Services Limited ranges between TT$16.99 to TT$19.51 and TT$15.19 to TT$25.21.
Individuals in Guardian who may not need cash should not only hold their shares but should be adding to their holdings to benefit from the cost savings and increased income that should flow from the greater linking of the group.

Are Proven & NCB buying 36% of Guardian?

Investment banker Proven Investments and National Commercial Bank, Jamaica’s number one banking group, are lining up to acquire some large blocks of shares in Guardian Holdings, the Trinidad & Tobago company. IC Insider has confirmed that the targets are – Tenetic Limited block of 35.84 million, which, amounts to 15.46 percent of the company and Arthur Lok Jack’s direct holding of 6.29 percent or 14.59 million units. Arthur Lok Jack’s is listed as having a beneficial interest in Tenetic. Royal Insurance Trinidad holds 22.33 million units or 9.63 percent and RBC Trust T&T controls 4.99 percent or 11.57 million shares.
Lok Jack wants out, as various sources indicate that his holdings were partially funded by borrowings and he now needs to liquidate the debt. Royal Bank, according to our sources, is moving completely out of the Caribbean region. This sale would be another aspect of their exiting. RBC sold the Jamaica operations last year to Sagicor Group and the Suriname operation to Republic Bank of Trinidad, slated to be sold the Cayman operation.
The acquisition of Guardian would be a complete reversal, returning the company to its Jamaican roots. Guardian was once majority owned by Jamaica Mutual life, but Mutual sold out their holding sometimes before they ran into Jamaica’s problems and folded. The Jamaican entities consider the company to be clean, well run and considerably undervalued. Part of the plan is to increase the dividend payments, which is just a third of profits and relist the shares on the Jamaica Stock exchange once more. No time frame was given when the deal will be sealed, but Proven has just raised approximately US$30 million in a rights issue of shares, so they are well prepared to take up their share with borrowings being a part it of the funding.
Guardian traded in Trinidad at TT$14.26 or U$2.23 on Wednesday. This would mean that the sale to Proven and NCB stands at a whopping U$$188 million, representing approximately 84.33 million units or 36.37 percent of the current share capital of 231.9 million units.
Guardian is primarily a Life Insurance company but also owns a general insurance arm. NCB operates the well known OMNI Life Insurance Company. Part of the likely synergy in future would be a merger of general insurance companies with Omni to be sold to the Life Insurance arm, enjoying economies of scale. The possibility exists that and the expanded general Insurance company could be listed on the stock exchanges within the Caribbean, thus spreading the risk associated therewith.
Guardian reported total revenues of TT$4.8 billion in 2014 and profit to shareholders of TT$401 million. Total shareholder equity stood at TT$2.9 billion and net asset per share TT$2.65. Dividends paid was 57 cents, covered by profits to the tune of just over three times.
Last year Proven acquired a block of shares in Knutsford Express bring their total holdings to 20,000,002 units or 20 percent of the company and 49 percent of Access Financial Services.Proven Investments is chaired by the leading Jamaican Lawyer, Hugh Hart, a former senator and minister of government under the Jamaica Labour Party regime of the 1980s. Some of the top shareholders include directly, or through companies they are connected to are Hugh Hart, Garfield Sinclair, CEO of Cable & Wireless Jamaica, Christopher Williams, President, Proven Investments and former manager of NCB Capital Markets, an NCB subsidiary; Senator Mark Golding, Justice Minister; Peter Bunting, Security Minister and Paula Kerr-Jarret. Transport and Works Minister Omar Davies is also a holder of shares in the company.
Patrick Hylton, President of NCB, is a director of Massy Holdings, of which Lok Jack is the Chairman.