Joe Matalon named chairman of KLE
KLE Group has announced that Joseph M. Matalon has been named chairman and that former diplomat and businesswoman Audrey Marks has been named a director of the entertainment company's board.
KLE now has a 10-member board. The other directors are top shareholder Gary Matalon and partners Stephen Shirley, Zuar Jarrett, Kevin Bourke, Craig Powell and David Shirley, as well as attorney Patrick McDonald and Garfield Coke.
Bourke said that Coke represents Usain Bolt, whose brand is licensed to the group for its Tracks & Records restaurants. Bolt's ownership in KLE will rise by less than a point to 10 per cent or 10 million shares after the initial public offering (IPO) which opens for subscription on October 9 and closes October 16.
Joseph M. Matalon, who is one of Jamaica's most respected businessmen and past president of the Private Sector Organisation of Jamaica, is cousin to Gary.
Marks, the former Jamaican ambassador to US, is a pioneer in the bill-payment field in Jamaica and founder of Paymaster Jamaica Limited.
The IPO is priced at J$3.70 per share but at least one brokerage has said the offer is overpriced.
Given KLE's stated intention of a 40 per cent dividend policy and the challenged economy which has contracted in the past two quarters, JMMB said KLE would need to increase revenue 130 per cent to make the subscription fairly priced.
JMMB in its analysis issued Friday said the stock would have been more fairly priced at J$2.47 per share.
"Against this background, despite the tax benefit of listing on the Junior Stock Exchange and the likely uptick in revenues due to the upcoming new ventures, it's a highly risky investment to make at this time," wrote the JMMB researchers.
"Given the level of uncertainties surrounding the macroeconomic environment and challenges the company will face to meet its revenue and operating targets, this stock is not recommended at this time," the brokerage said.
KLE Group currently comprises the Tracks and Records restaurant and Fiction nightclub, but the company plans to add another club to be called Famous, and to diversify into villa development in partnership with Sagicor Life Jamaica and gaming with backing from Supreme Ventures Limited.
The junior market IPO is expected to raise J$94.6 million.
KLE is a four-year-old operation.
Its board spans expertise in business, finance, retail, architecture, marketing and legal services, among other areas.
Bourke said Matalon became chairman around August of this year.