First Rock targets year-end IPO
Fresh from an aggressive foray into Costa Rica, investment upstart First Rock is targeting a year-end initial public offering to satisfy commitments to its private backers that the real estate company would go public.
First Rock is also looking to replenish its war chest, having invested 90 per cent of its holdings to date.
Co-founder and CEO Ryan Reid says his company is at the initial stages of applying for listing on the main market of the Jamaica Stock Exchange.
“We made a commitment to the shareholders in our private placement that we’d be approaching the market for listing on or about six months after the close, and we’re about at that time now – so we expect to be at that point by about year end,” said Reid.
In March, First Rock Capital Holdings Limited raised $2.5 billion from private investors, all of which it, at the time, intended to pump as equity into various real estate ventures and other companies.
Its targeted fundraising on the stock market could be as much as $4.5 billion, that is, enough to cover the $2.5 billion, plus an additional amount to serve as ‘dry powder’ as First Rock shoots for more investments. The term ‘dry powder’ is a reference to cash or short-term investments that can be easily liquidated to finance investment deals as they arise.
“Barring anything on the regulatory side, we would certainly want to be able to cover the amount on the initial private placement, plus another amount that will leave us comfortable to deal with matters in the pipeline – say another $1.5 billion to $2 billion,” said Reid. “It could be more, but no less than that,” he told the Financial Gleaner.
Meanwhile, First Rock is celebrating two deals in Costa Rica with two established developers in that country, but has released few details on the transactions, including the size of the investments.
This adds to the recent purchases in Florida and Cayman Islands.
“We’re very bullish on Costa Rica. Prior to this year, it was a jurisdiction that we were not familiar with, but we spent some time scouting and understanding the strategic landscape; then we found a valuable partner in Ernst & Young Law,” Reid said, while not disclosing the amount invested.
The Costa Rica investments are held through First Rock Capital LATAM, a newly created vehicle.
Asked for a rundown of the company’s portfolio, Reid says First Rock has already deployed 90 per cent of its investment funds, with 60 per cent of the portfolio invested in Jamaica.
The company has also identified three commercial targets in Kingston, in addition to residential properties in Kingston and on the north coast, for the deployment of the remaining funds.
Some of those deals have closed, and one is due to be finalised in another two weeks.
The company continues to seek out opportunities in other foreign markets, but is partial to those whose workings it thinks it understands, one of which is Guyana.
“Panama is a jurisdiction that we’re eyeing, but we don’t think we understand it. The place we’re really looking at is Guyana. We’ve been there a few times. We have a good set of partners down there, and we’re just waiting on the elections to take place in March next year,” he said.