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Sagicor X Fund to raise US$40m for Hilton Rose Hall purchase

Published:Wednesday | December 3, 2014 | 12:00 AM
Rohan Miller, executive vice-president and chief investment officer of Sagicor Life Jamaica Limited.

Avia Collinder, Business Reporter

Sagicor Real Estate X Fund Limited is seeking debt financing of $4.5 billion to fund its acquisition of the Hilton Rose Hall hotel, which it struck a deal to buy in October from private equity firm Blackstone Group.

Sagicor X Fund's board signed off on the pending debt issue last Thursday, which the company said should be completed by yearend.

On Monday, chief executive officer of X Fund, Rohan Miller, said that details on the debt placement would become available when the transaction closes around the final week of December.

However, Wednesday Business has obtained a copy of the prospectus indicating that the company is seeking US$40 million or its Jamaican dollar equivalent in a private placement that opened December 1.

The fixed rate bond has a coupon of 5.5 per cent and and is priced to yield six per cent to maturing in 18 months, June 2016.

Minimum subscription is J$10 million or US$100,000.

The Hilton Rose Hall was said earlier to be valued at US$100 million, but the sale price has not been disclosed.

Wednesday Business understands, otherwise, that X Fund is close to wrapping up the debt issue, and that one of the targeted backers is located overseas.

The arrangers of the offer are Sagicor Investments Jamaica Limited, for which Miller is also CEO, and NCB Capital Markets Limited.

Sagicor X Fund is 67.7 per cent owned by the Sagicor Pooled Pension Investment Funds, which are administered by Sagicor Life Jamaica Limited. It started operations in November 2013 after going public with a share offer the month before that raised $1.5 billion.

Sagicor X Fund's total portfolio is invested in the Sigma Real Estate portfolio, a unit trust fund which holds a mix of hotels, commercial, industrial and warehousing properties.

X Fund had total assets of $9 billion at September, up from $8.418 billion at December 2013.

The company reported revenue of $681 million for the nine-month period to September from gains on its investment income, and $681 million of net profit. X Fund, which is registered as an international business in St Lucia, had no operational or tax expenses in the period.

Hilton Rose Hall located in Montego Bay will eventually be rebranded a Jewel Resort, growing the portfolio's total room count to 1,230. Sagicor Sigma currently owns three other Jewel resorts, all located in St Ann.

Operated as a family resort, Hilton Rose Hall has 489 rooms seven all-inclusive restaurants and bars, 44,000 square feet of meeting space, a water park, six tennis courts and a spa. The property spans 30 acres.

The Hilton acquisition is expected to be finalised in early 2015.