ANSA McAL to acquire majority of Berger Jamaica
Trinidad & Tobago conglomerate ANSA McAL Limited has signed an agreement to fully acquire Lewis Berger Limited (LBOH), which holds Berger Paints assets in Jamaica, Trinidad and Barbados.
The transaction is expected to close in the third quarter of 2017, giving ANSA McAL majority control of all three businesses.
LBOH holds 100 per cent of Berger Paints Barbados Limited, 70 per cent of Berger Paints Trinidad Limited and 51 per cent of Berger Paints Jamaica Limited.
LBOH itself is a United Kingdom company privately held through Berger International Private Limited. Their ultimate parent is Asian Paints of India.
ANSA McAL says the acquisition of LBOH will enhance the group's position in the Caribbean architectural coatings market.
"The architectural coatings industry has enjoyed a period of healthy innovation over the last decade. Through this acquisition, we hope to address an expanded customer base with a broader suite of product offerings and superior levels of customer service and support," said group chairman and CEO, Norman Sabga, in a release on the company's website.
Trinidad was in lockdown ahead of Tropical Storm Brett and phones rang unanswered.
ANSA McAL will make a cash payment for the paint company, but the amount was not disclosed. The combined regional paint operations earn US$35 million (J$4.5 billion) in annual net sales, the release stated.
ANSA McAL will make the acquisition through subsidiary ANSA Coatings International.
$1 BILLION IN EQUITY
The Jamaican operation holds $976.9 million in total equity at year ending March 2017 with $1.5 billion in total assets. Berger Jamaica earned $316 million in net profit on $2.36 billion in sales or 158 per cent higher net profit year on year. The company currently trades at $17.50 per share, valuing it at $3.75 billion on the stock market.
It's unclear whether ANSA will be required to make a mandatory takeover offer for Berger Jamaica, as queries to the Jamaica Stock Exchange were unanswered up to press time.
Berger will be the third JSE listed company to be acquired indirectly since last year, one of which is before the courts as Liberty Global tries to stave off efforts by the Financial Services Commission to force a buy-out of minority owners of Cable & Wireless Jamaica.
ANSA McAL is a diversified conglomerate across eight industrial sectors, operating in around eight countries. The group is listed on the Trinidad stock exchange with market capitalisation of US$1.7 billion. Through its ANSA Coatings subsidiary, the conglomerate has produced and marketed paints, coatings and materials for over 55 years.