Existing Stockholders of Key Insurance will be given the right to apply for new shares in the company and have been provisionally allotted 259 new ordinary shares for every 500 existing ordinary shares at $3.50 each.
The offer is renounceable and will therefore allow existing Key shareholders to assign their rights to these shares, wholly or in part, to others. Shares not taken up will be available to shareholders who indicate they wish to acquire more new ordinary shares than their allotment.
The issue will open on December 23 and will close on January 11, 2021, with the last date to renounce the rights, being January 4, 2021.
The issue will raise approximately $670 million to boost the company’s equity base. In the offering circular dated December 11, Chairman of Key Insurance, GK Group CEO Don Wehby explained, “The capital the rights issue will raise will be critical to the implementation of Key’s vision and strategic plan, which focuses on achieving profitability targets and sustainable long-term growth, which in turn will provide an attractive return on investment to our shareholders. The Board is extremely optimistic about Key’s future, and we are confident that the management team is well positioned to maximise the Company’s full potential and shareholder value.”
In March this year, GraceKennedy Financial Group acquired 65 percent of the share capital of Key.
The Issue is one component of the overall strategy implemented by Key’s Board and management team in 2020 geared towards strengthening the Company’s capital base so as to ensure regulatory compliance and future growth. Key has also entered into an agreement for the divestment of its investment property located at 18-22 Knutsford Boulevard. The sale of the property will be completed in the first quarter of 2021.
The company reported a small profit for the September quarter of $5 million from net premium income of $204 million but reported a loss of $538 million before tax credit of $180 million for the year to September. The year to date loss. includes a one-off charge of $323 million against profit.
The offer is underwritten by GK Capital Management. The stock’s last trade on Wednesday was $8.40, giving shareholders a big incentive to purchase.
This issue is the third to come to the market at the same time. Sygnus Credit Investments Additional Public Offer (APO) to open on December 18 and closes on December 23 to raise upwards of US$10 million while Derrimon Trading APO opens and closes in January to raise $3.50 billion.
Key rights issue offers big upside
Barita rights issue closes in March
Barita Investments – 2018 best performing JSE stock.
Barita Investments held an Extraordinary General Meeting on January 17, 2019 and passed the Resolution to issue up to 262,280,484 ordinary shares as a Rights Issue to Stockholders and gave the power to the directors to set the other terms.
Subsequent to the meeting, the directors agreed the terms of the issue with offer opening on February 25 and closing on March 18 to shareholders on record at February 5 at a price of J$15.50 per share. Shareholders will be entitled to ten shares for every seventeen shares owned on the record date. Shares not taken up by existing shareholders will be available to other shareholders who apply for excess shares. The deadline for applications for any excess shares is March 25.
Barita’s stock has been trading in the $50 region for sometime, spurred partially by announcement of the rights issue plus other positive developments for the company, including new business.
Barita’s share was the best performing on the Jamaica Stock Exchange in 2018, with gains of 593 percent.
$450m rights issue for Sterling
Sterling Investments Limited is setting to raise around J$450 million by way of a renounceable rights issue by April this year. The opening date of the issue will be March 18, with closure set for April 8.
Before the issue, the directors are planning to get approval for a stock split which IC Insider understands is likely to be 10 new shares for each one now existing. This means that the right issue price should be under $13.40, the price that the stock has traded at recently, assuming the split takes effect at the above ratio.
The company has called an extraordinary general meeting of shareholders for February 21, 2015 in St. Lucia to consider increasing the share capital, approving the stock split, authorizing the Directors to implement a Rights Issue and to carry out all steps and documents needed to give effect to the stock split and to implement the Right Issue.
Sterling is primarily involved in investing funds in mostly debt capital denominated in foreign currencies. At September last year, profit from operations totalled $48.36 million or 16 cents per share and total comprehensive income ended at $62.8 million. For the September quarter, profit amounted of $9.9 million down from $12.57 million in 2013 with negative total comprehensive income of $2.3 million. At end the end of the period equity capital amounted $544 million. NCB Capital Markets are the brokers to the rights issue.
The Directors intend to consider the payment of a final dividend at the Directors meeting that is scheduled on February 21, 2015. The company paid a dividend of J$1.35 in June last year.