Wed | Aug 23, 2017

CAC raised $130 m in IPO

Published:Friday | January 1, 2016 | 1:00 AM

CAC 2000 Limited, an air conditioning and engineering company based in Kingston, raised $130 million in its initial public offering (IPO) on December 18, becoming the second company to raise funds in that month on the junior market of the Jamaica Stock Exchange.

CAC intended to raise $120 million from the IPO, which opened on December 16, but received $10 million above its target with more than 100 applicants taking up the offer.

The company, which provides air-conditioning and energy solutions for mainly large developments in Jamaica, raised funds to increase its working capital and to take advantage of merger and acquisition opportunities.

"We are excited about the future of CAC and elated at the support from the business community for the IPO and their confidence in our growth plans. The company has always demonstrated steady growth. This will allow us to catapult our growth and have the cash flow available to undertake even more projects," said Steven Marston, chairman and chief executive of CAC.

"There are numerous development projects happening within the private and public sectors. A tremendous amount of investment into tourism is expected to commence within the next 12 months," he said, adding that "we are now in a position to expand a fully grown Jamaican company and compete at the international level."

The company sought to raise funds from subscriptions for 29,032,258 shares priced at $4.89 per share. Trading in CAC's shares is likely to begin within three to four weeks of the closing date.

VM Wealth Management have been lead brokers to the subscription with legal counsel provided by Matthew Hogarth of Wilmot Hogarth and Company, who also served two IPOs in the last quarter of 2015. It follows the initial public offering of technology company tTech Limited.

CAC 2000 earned total comprehensive income of $37.48 million on revenues of $823.7 million for its year ending July 2015, compared with $38.35 million in 2014. Currently, CAC 2000 holds total assets of $543.96 million with $177.9 million in shareholder equity, up from $155.84 million a year ago. The company employs 45 staff of which 10 are engineers.

CAC 2000, based at Marcus Garvey Drive, Kingston, and Car Jars Plaza in Montego Bay, offers some of the largest and, most technologically advanced range of air-conditioning systems in Jamaica. It sells a wide range of known brands, including Carrier, LG, Mitsubishi Electric, Fujitsu, Carlyle, Honeywell, Sanyo, Emerson, TopTech and Fasson, among others.

The company began in the late 1920s with Webster's Engineering. In the mid-1960s, the ICD Group, formerly the Mechala Group, bought Conditionedair Corporation and merged it with another company to form Conditionedair and Associated Contractors (CAC). That company was later merged into the renowned Homelectrix, which was a household brand.When Homelectrix was sold in the 1990s, the management team purchased 49 per cent of CAC. On July 24, 2000 the company was incorporated and the remaining 51 per cent purchased on August 18, 2000, hence the name CAC 2000 Limited.

CAC 2000 provides air-conditioning equipment and parts combined with what it said are world-class technology and engineering services. The company also offers its own branded line of air-conditioning products, the CAC brand.

steven.jackson@gleanerjm.com