Barita up 593% top 2018 JSE stock

Barita climbs to a new closing high of $50 on Friday to gain 593% in 2018..

Stocks on the Jamaica Stock Exchange main market ending 2018 with a credible gain of 31.7 percent but brokerage house Barita Investments surged a by a huge 593 percent to be the markets best performing stock in 2018.  
Barita Investments gain mostly came after Cornerstone Investment Holdings officially sealed the deal to take over the company and laterally, after announcing a rights issue to shareholders at an exercise price of $15.50. The stock closed the year at $52. But there is a lot more going on with this company as the new majority owners take a more aggressive approach to capture more business locally and within the wider Caribbean.
Four stocks end 2018 with gains of more than 100 percent contributed to the year’s performance but the year’s movement fell below that of 2017, when the index rose 50.7 percent. The next best performer could only deliver a 211 percent rise in contrast to the stunning gains by Barita. Salada Foods ended the year with a jump in price to $35 on strong gains in profit, to capture the number 2 best performing spot rising by 211 percent for the year, followed by Palace Amusement with gains of 159 percent, the third year in a row that it is occupying the top 10 list. Kingston Wharves grew 135 percent to be one of 4 stocks to reappear in the top 10 for two consecutive years. Jamaica Broilers gained 67 percent. Pulse Investments reappeared in the Top 10 with a rise of 66 percent and heavy weight, PanJam Investment put in a strong showing of 65 percent, while Supreme Ventures chipped in with 57 percent, Mayberry Investments rose 52 percent and NCB Financial with 50 percent to retain one of the Top 10 spots for the second year in a row.
The worst performing stocks included Ciboney down 71 percent due mainly to the sale of property it previously owned with most of the proceeds distributed as a dividend thus reducing the value of its assets to a few million dollars. 138 Student Living was next with a fall of 42 percent with Portland JSX ending with a loss for the year of 25 percent following on from Kingston Properties with 22 percent and Sygnus Credit Investments with 20 percent from it 2018 IPO price. Both Ciboney and Carreras that are in the top 10 worst performing stocks in 2018 are coming from the top 10 in 2017.

Big gains for JSE Monday

The main market of the Jamaica Stock Exchange surged 11,391.32 points on the All Jamaica Composite index (AJI) with nearly 2 hours of trading on Monday with the index at 417,227.47 points but pulled back from the day’s high of 421,063.54 points earlier after rising 15,227.39 points.
The JSE Index climbed 10,378.78 points to 380,141.40 but the Junior Market Index rose 47.45 points to 3,229.84.
NCB Financial traded at $150, Barita Investments traded at a new high of $55, Grace Kennedy at $68.50 and Sagicor Real Estate Fund jumped to $13.93.

Barita shareholders to vote on rights

Barita climbs to a new closing high of $50 on Friday.

Barita Investments (BIL) has advised that the Board of Directorshas taken the decision to withdraw its Notice of a Rights Issue to BIL’s shareholders, dated December 14, 2018 and instead hold a meeting of shareholders to consider the matter.
As a result an Extraordinary General Meeting of shareholders will be on Thursday, January 17, 2019, at the Terra Nova Hotel, at 10 am to consider the issue of increasing the issued shares by way of a rights issue.
“The purpose of the meeting is to ensure that BIL’s minority shareholders will have an opportunity to contribute to the decision for a Rights Issue,” the directors stated in their release to the Jamaica Stock Exchange.
The resolutions to be put to the extraordinary general meeting, include one for the issue of 262.28 million shares, as a rights issue. Each shareholder will be entitled to 10 shares for each 17 held, at the record date. The price for each share of the rights, is expected to remain at $15.50, as originally approved by the directors, unless varied at the upcoming meeting. The resolution is also asking that the terms of the issue are to be determined by the directors.
The rights in the original directors release were to be non-renounceable, if this condition remains after the vote at the meeting, it will mean that shareholders will not be able to sell their rights to a third party, as such if they decide not to take them up they will not be able to benefit directly from the issue.
The directors had previously voted to offer the rights to shareholders without calling a general meeting but after consultations, decided to put the matter to a general meeting of shareholders where it properly belongs.
Since announcing the rights in early December, the stock price has risen more than 56 percent to $50 and is up 567 percent for 2018 to be the stock exchange’s best performing stock.

Proven buys NCB’s block of JMMB shares

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NCB Financial Group sold all the JMMB Group shares amounting 326.7 million units amounting to 20 percent of the total issues shares of the money market brokerage.
The shares were put through the Jamaica Stock Exchange only a few minutes after trading opened today, at $28.25 each and resulting in a consideration of $9.2 billion.. In September this year, PanJam Investment purchased 100 million or 6.1 percent of JMMB shares from NCB, leaving the block that was traded today. A spoke person for PanJam, indicated that they are not the buyers of today’s trade. Our sources indicate that Proven Investments are the buyers of the block today.

Fontana listing in January

Artist impression of Fontana Waterloo Road

Fontana shares are not likely to start trading until January. Feedback from the Jamaica Stock Exchange indicates that the listing committe that has to meet to approve the listing wont meet until next week. 

IC had previously reported that it would list today which was based on information gleaned from our sources. The shares allocated for the public pool that seems to be at variance with the terms of the propectus would need sorting out, before the shares are listed if in fact the allocation announced is different from the terms of the prospectus.

Fontana allocation varies from prospectus

The Fontana prospectus state that multiple applications by any person whether in individual or joint names will be treated as a single application, but the information included in the brokers release regarding allocation seems at variance with this.
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”.
It would appear that had the allocation been done in conformity with the terms of the prospectus, the number of shares applied for would still remain at 982,194,569. All multiple applications are to be merged to be one, as such investors

Fontana Waterloo Road

in the public pool should be allocated differently than what has been announced.
Contracts once consummated, are expected to be adhered to, accordingly, the terms set out in the Fontana prospectus, need to be satisfied as far as allocation of the shares are concerned.
The broker needs to explain to the public if in fact the allocation for the public pool is in keeping with the terms set out on page 14 of the prospectus and if not why not and what will be done to comply with the terms that investors signed on for. It appears that the brokers are trying to unilaterally vary the contract that investors signed on to and they cannot do that.

NCB to go for 62% of Guardian

NCB Financial Group is to go after 62% of Guardian Holdings.

NCB Financial is to make a revised offer to acquire 62 percent of the Trinidad based Guardian Holdings (GHL), at a revised price of US$2.79, the group said today, in a release.
This is in line with the original offer made in 2017 but at higher price and above the 51.85 percent at US$2.65 they agreed to, after being investigated by the Trinidad Exchange Commission. The revised offer which will be published soon, with the exact timing is yet to be determined. The acquisition is to be partially funded by US$45 million to be provided by way of vendors’ loan from selected shareholders.
The acquisition is set to make a major impact on the NCB Group and ultimately the stock price. For one GHL is being bought for just less than 10 times earnings while NCB is selling at 15 times 2018 earnings as such the impact on the price of NCB shares will be seen in 2019 as GHL profit will be

Guardian Holding

valued more to NCB shareholders. Most importantly, majority ownership will permit it to reshape the group by merging the separate insurance companies and securities operations into one and allow it to rationalize various back office operations within the group into one unit and thus cut considerable cost out of the enlarge group.
NCB already owns 29.99 percent of Guardian. The GHL shares last traded in Trinidad at TT$16.95 or approximately US$2.53. NCB closed trading on the Jamaica Stock Exchange at $148.

ICreate to open January

The ICreate initial public offer of shares is expected to open on January 4 with the prospectus set to be released either later this week or next week.
Information gleaned by IC is that 74 million ordinary shares will be offered for sale to the public at approximately $1 each and is slated to list on the Junior Market of the Jamaica Stock Exchange. Revenue is said to be running at just under $50 million per annum with prospects for strong growth going forward. Already the company is making a small profit IC gathers. The business is the training of students in graphic designs and animation.
The majority shares are owned by EMedia Limited with Sagicor Investments holding a minority position in it.

IC article stings JSE into action

Marlene Street Forrest – General Manager of the JSE is said to have intervened to reset the price Express Catering could trade at on Tuesday.

The article, The stock exchange needs radical overhauling seems to have stung the exchange into action as all the errors that were left unattended for months, are now corrected.
Delisted stocks that were being carried as if they were still listed are now out of the trading sheet. Eppley 7.5% preference share that was recently listed, is now correctly placed in the preference section. Barita Investments 52 weeks’ high is now at $33.50 instead of $60 that was being carried for weeks. Hopefully, the exchange would have corrected all other erroneous highs and lows that resulted from cancellation of trades in the past. Importantly, the errors in the All Jamaica Composite Index for the early days of November are now correctly stated.
The Stock Exchange is to be commended for moving speedily to correct the errors that were brought to their attention. It would also be good in order to better protect their integrity that compensated investors who were firstly advised of an allocation of 16.56 percent of Seprod shares only to see it adjusted down to 16.26 percent. That would be the correct thing to do in the circumstance that prevail that led to the adjustments that took place. The phrase, the customer is right is still a valid principle to operate by.
When all is said and done just correcting the errors IC pointed out is only a first step, the exchange needs to put in place quality control mechanisms to prevent such occurrences. It also appears that the exchange needs a qualified lawyer and accountant on board with sufficient securities experience to help police the systems effectively. If they do it could prevent matters such as prospectuses and financial statements being issued with the types of errors that are showing in the public space.

Barita proposes $15.50 rights issue

The directors of Barita Investments on December 13, passed a resolution for a Rights Issue of 10 shares for each 17 owned at the record date, to take effect in early January which if taken fully will results in 258 million new shares and bring the capital issued to 707 million units.
The board resolution states:- The Board approves the issue of 258,064,516 ordinary shares (in this resolution “New Ordinary Shares”) part of the authorised capital, the same to be offered to the holders of Ordinary Stock Units by way of a Non-Renounceable Rights Issue on the following terms:
(i) Offer Price of J$15.50 per New Ordinary Share. (ii) Offer to Stockholders of the Company as at a Record Date of December 31, 2018. (iii) Offer to Open on January 8, 2019
(iv) Last date for splitting to be January 15, 2019. (v) Offer to Close on January 22, 2019 for acceptance by Existing Ordinary Stockholders/Renouncees
(vi) Offer to Close on January 25, 2019 for acceptance by applicants for Excess Shares (not taken up by Allottees under the Letter of Provisional Allotment).
2. The Directors are hereby authorized to dispose of all such New Ordinary Shares not taken up by Allottees on terms and conditions as the Directors may consider expedient in their absolute discretion, in consultation with the Arranger for the Rights Issue, Sagicor Investments. BIL further advised that the share ratio allocation for the Rights Issue will be as follows: Ten (10) additional shares for every seventeen (17) shares owned by existing stockholders of Ordinary Shares in Barita Investments.
Apart from a rights issue, the above resolution speaks to the last date for splitting being January 15, which raises the question if a stock is to be considered as well.
Barita stocks that trades on the Jamaica Stock exchange at $33.45 on Friday and is up 346 percent for the year to date.