Liz Levy, Gleaner Writer
( LEFT - RIGHT ) MATALON and MELHADO
THE INDUSTRIAL Com-mercial Developments Limited (ICD) is to scale down its organisational structure and out-source its head office management services, as the holding company continues to rationalise its operations.
In confirming the move, ICD president and chief operating officer Peter Melhado explained: "We've been doing a fair amount of rationalising. We've sold our stake in the bank (Manufacturers Sigma) and also Serge Island, so there really is no need to keep the group structure the way it was."
STRONG GROUP
Once a 32-subsidiary-strong group which was founded and controlled by the Matalon family, ICD currently comprises: its construction arm, WIHCON; WIHCON Properties; its general insurance firm, BCIC; and its insurance brokerage, IIB/CGM .
It is understood that veteran ICD executive Errol Powell, who up until last year managed Serge Island Dairies, is among those exiting the group. Powell is reportedly heading to PA Benjamin to help his son manage the enterprise he acquired from ICD roughly four years ago.
Melhado, who was only last year appointed president and group chief operating officer after the sale of Manufacturers Sigma to Pan Caribbean Financial Services, said as of the beginning of May the head office functions related to the remaining four ICD entities had been out-sourced to Hyperion Capital Limited.
Hyperion Capital has four partners. These are Melhado, ICD chairman and chief executive Joseph M. Matalon, Christina Matalon, and former KPMG partner Vikram Dhiman.
The firm will be located at ICD's Harbour Street head office.
"ICD will still exist," Melhado emphasised. "It's just that Hyperion will be providing the same type of group services to the subsidiaries."
ICD chairman and CEO Joesph M. Matalon, in an interview, also pointed to the expected savings as a result of the new management arrangement, adding that "while there are no specific plans, it would also give ICD more flexibility in the event of any further contraction."
"We (Hyperion) will also be providing services to other companies and doing other things," said Melhado, who did not get into specifics on the scope of activities envisaged for the firm.
ICD Group Limited was established in 1962 by the Matalon family, evolving over the next three decades into a trading and manufacturing conglomerate with 32 operating companies. However, in the mid-1990s, after five years of high real interest rates, the company was forced to restructure its balance sheet and inject additional equity.
In 1995, the family acquired all outstanding publicly held shares through a vehicle called the Mechala Group Limited, and attempted, without success, to raise equity on the international market. The following year, it floated a US$100 million bond, and in late 1999, the group embarked on a major restructuring of its operations, which saw it divesting such companies as PA Benjamin in a management buy-out, Facey Commodity to the Mussons Group, Shoppers Fair supermarkets to Progressive Grocers, and its life insurance portfolio to the Guardian group.
By 2000, the family bought back the bond, pumped additional equity into the entity, and eventually reduced the group's debt from US$68 million in 2000, to its current situation with a debt-free balance sheet.
