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Caribbean Flavours takes on new partner in $100m deal

Published:Friday | June 23, 2017 | 12:00 AMSteven Jackson
Derrick Cotterell, managing director of Caribbean Flavours

An unnamed entity has acquired 10 per cent of Caribbean Flavours & Fragrances Limited under a new partnership that the company says is meant to boost exports.

The transaction was valued at $108 million.

The sale of the 8.9 million shares was recorded on the stock exchange on Monday. It moved the price of the stock on the day from $11.40 to $12.75 per share.

Managing Director of Caribbean Flavours Derrick Cotterell said that the new investor wanted a stake in the venture as an incentive. The two companies will work on "several projects" together, he said.

"There are some things that we are doing in the long term and there was some interest for them to have equity in Caribbean Flavours," said Cotterell, while noting that Caribbean Flavours is positioning to sell more to foreign markets.

Caribbean Flavours, which manufactures flavours for food companies, is majority owned by Cotterell's company Derrimon Trading Company Limited.

Cotterell identified the new minority owner only as a locally based operation. He declined to say which shareholder or shareholders sold CFF shares under the deal, but Derrimon itself could easily have been the sole seller, given its holdings of 67.46 million units up to March.

Derrimon's ownership at that point was 75 per cent of the company, with the other top owners being Mayberry Managed Clients, 2.68 million shares; Ian C. Kelly, 2.32 million; Lloyd Badlal, 2.24 million; Konrad Berry, 1.76 million; Howard Mitchell, 1.44 million; JCSD Trustees Services Sigma Venture, 1.33 million; Ideal Global Investment, 1.16 million; Manwei International, 975,830; and Mayberry Investment Ltd Pension Scheme, 972,945 shares.

In early August 2014, Derrimon acquired 49 per cent of Caribbean Flavours for $121.2 million or $2.75 per share. Then in December 2016, Derrimon announced that it planned to purchase another block of shares from founders Anand James and his wife Dr Joan James at $4.50 per share, in a deal executed earlier this year, increasing Derrimon's holdings to 75 per cent.

Minority owners rejected the mandatory offer for their shares that followed in January, even with the sweetener of an interest payment on the $4.50 offer, saying the price undervalued the company.