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NCB to close 17-month offer for Guardian’s shares by May 13

Published:Thursday | May 2, 2019 | 4:38 PM

Banking conglomerate, NCB Financial Group expects to close the longstanding offer for the acquisition of a majority stake in Guardian Holdings Limited, (GHL) by May 13.

That date represents a 10-day extension in the 17-month since it has been seeking to acquire the shareholding in GHL.

“All the terms and conditions of the offer have been complied with or waived as of the 2nd day of May, 2019,” stated the company in a release today.

NCB appears satisfied with the offer, expressing gratitude to those who participated.

The other shareholders were not named but large shareholders Arthur Lok Jack and the Ahamad family wanted NCB to acquire the majority stake in GHL rather than sell out to a non-Caribbean banking entity, Lok Jack told the Financial Gleaner in a previous interview.

NCB currently holds 29.9 per cent of GHL’s total shareholding and wants to own up to 62 per cent.

Up to Thursday, shareholders with 118.5 million units want to sell shares to NCB or about 80 per cent of the total shareholdings.

NCB will, as a consequence, take up the shares on a pro-rated basis in order to cap its spending to US$207 million to acquire roughly 32 per cent additional shares to bring its total to 62 per cent.

NCB proposed to finance US$45 million of the acquisition through a loan from key shareholders Lok Jack and Ahamad family. But the Trinidad government objected, saying the financing deal had to be separated and that all shareholders should be paid in cash.

NCB said it would comply. This was an important hurdle to cross to get a licence under the Foreign Investment Act on Monday. NCB, however, needed permits from the Central Bank of Trinidad & Tobago.

The update on Thursday became the sixth extension for the re-launched offer which opened in December 2018. There were also delays and extensions in the original offer launched in December 2017. The delays and extensions resulted in the offer running for 17 months.

The takeover bid was initially expected to wrap up in two months after the December 2017 offer came on the market.

Resistance from minority investors over a higher share price paid to large shareholders the year before eventually led to scrutiny from the Securities and Exchange Commission in Trinidad & Tobago, and the lapsing of the deal in early 2018.

NCB subsequently upped the price and relaunched its bid last December, with expectations that it would have wrapped up in February.

It was extended three times in February, once in April with two new dates announced for May.

NCB said Tuesday that it still needs another permit from the central bank in Trinidad & Tobago to complete the takeover offer.