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Holding company for CLICO assets to launch IPO on Trinidad exchange

Published:Wednesday | May 16, 2018 | 12:00 AM
Prime Minister of Trinidad & Tobago, Dr Keith Rowley. The Rowley administration continued the efforts of its predecessors to recover rescue funds pumped in saving CLICO.

Several assets that once belonged to the CL Financial Group and its flagship company CLICO are being folded into a new entity called National Investment Fund Holding Company, (NIF), which the Trinidad & Tobago government plans to float on the stock market in June.

Finance Minister Colm Imbert, who told parliamentarians that NIF would have a value of around TT$8 billion to TT$10 billion, said the Rowley administration would offer 49.9 per cent of the company to stock market investors in an initial public offering.

The Trinidad government bailed out CL Financial in 2009, following the collapse of regional insurance powerhouse CLICO. The IPO is the latest initiative to recover funds spent to rescue the group, which cost the government TT$23 billion over time. Under that recovery programme, for example, J. Wray & Nephew Limited in Jamaica, in which CL Financial held majority ownership, was sold to the Campari Group of Italy back in 2012.


Selected holdings


Imbert did not say precisely which assets would end up in NIF's ownership, but he noted it would include selected holdings of CLICO, CLICO Investment Bank, and the government's holdings in Trinidad Generation Unlimited.

"We propose that the initial public offering would take place in June 2018, thereby serving to widen and deepen the domestic capital market and at the same time ensuring that all of our citizens, large and small, participate in the benefits, regular dividends and shareholding growth, flowing from the quality of the companies in the National Investment Fund Holding Company," he said.

Otherwise, in an update on the recovery efforts and monetisation of CL's holdings, the minister reported that the first distribution of assets from CLICO Investment Bank, a total of 42.47 million shares or 26 of Republic Bank valued at TT$4.3 billion are being transferred to the government, in addition to the 25 per cent stake already held by the CLICO Investment Fund;

Other transfers include: 23 per cent of One Caribbean Media valued at TT$200 million; 29.9 per cent of Angostura Holdings valued at TT$1.07 billion; 5.4 per cent of West Indian Tobacco valued at TT$402 million; and 19.5 million shares of Home Construction, valued at TT$476 million.


Recovered cash


Imbert said cash of TT$3.8 billion has been recovered from CLICO since September 2015 - the date that the Keith Rowley government took office - and lands in Tobago valued at TT$186 million, which he said is the site of the proposed Sandals resorts.

The government is also currently pursuing the sale or acquisition of shares held in Methanol Holdings International Limited, valued at over TT$2 billion, as well as the recovery of TT$500 million in bonds. An estimated 40 per cent of Angostura held by CL Financial and/or CLICO, among other assets, are to be recovered as well, Imbert said.

Some of those assets will be transferred to NIF ahead of the IPO, he told lawmakers.

"Our target date for the launch of the National Investment Fund prospectus and offer for sale of shares or units to the public in the NIF is June 2018, and our objective is to monetise the assets of the fund and realise our projected capital revenue by the end of July 2018," said the finance minister.

"Without any ballyhoo, since we took office in September 2015, we have so far recovered from CLICO and CIB 26 per cent of Republic Bank valued at over four billion dollars for the benefit of all our citizens, and six billion dollars in cash and other assets," he told legislators.