Lascelles' remaining assets worth J$800m - To be sold off in four months
The board and shareholders of Lascelles deMercado officially approved the setting-up of a new company aimed at offloading J$800 million worth of Lascelles assets within four months.
Shareholders will receive the sale proceeds in a dividend payment.
The new entity, known as New Transport Group (2012) Limited (NTG), precedes the pending sale of Lascelles' core spirits business to Milan, Italy-based Campari Group.
The 900 shareholders in Lascelles will each receive NTG shares apportioned to their existing Lascelles shareholding, Fraser Thornton, managing director of Lascelles, told Wednesday Business.
"So if you held two per cent in Lascelles you would own two per cent in the new entity," he said on the margins of an extraordinary general meeting on Tuesday.
New Transport Group will contain Globe Limited, a small investment company, which is separate from the previously sold Globe Insurance holdings; John Crook and subsidiaries; Turks Islands Importers Limited and TIMCO; AJAS Limited; Transportation Agencies; and Kingston Industrial Garage, Sterling Motors and Henriques Brothers.
Lascelles, which up to this year was the second-largest shareholder of cigarette distributor Carerras Limited with 74.26 million shares or 15.3 per cent of the company, has disposed of all the shareholdings, the Campari offer document disclosed.
Mixture of companies
Within NTG, previously referred to generically as 'Newco', "there is a mixture of investment companies, holding companies and operating companies," said Thornton. "The main operating companies are AJAS and KIG."
Campari last week stated that it has secured agreements to acquire 90.7 per cent of the Lascelles ordinary shares and 97 per cent of the conglomerate's preference shares.
This would result in the delisting of the company based on the Italian company surpassing the delisting threshold outlined by Jamaica Stock Exchange rules.
Campari is paying US$4.32 per ordinary share and US$0.57 for the prefs through subsidiary Campari Espana. Its US$414.75m (J$37.8 billion) takeover offer - which opened November 9 and closes November 30 - is confined to the spirits and merchandising operations.
Globe Insurance, which was the most valuable asset in the remaining businesses, was previously sold to Guardian Holdings Limited for US$38 million (J$3.4 billion).
"Newco will have a value of J$800 million, which represents the book value of the companies transferred," he said.
"So Newco is specifically set up to hold the non-core assets in Lascelles with the purpose of divesting those assets."
NTG is expected to remain in place beyond the timeline expected to dispose of the assets, in order to receive any subsequent cash distributions which may come from Campari.
"We expect Newco to divest its operating assets within the next three to four months," Thornton said.
Negotiations on the sale of the remaining assets are ongoing.
"There are interested parties," Thornton said. "All interested parties are local entities."