Regency Petroleum going public

After hitting the market as a start-up in May 2018, Regency Petroleum Limited, RPL, says it will be approaching investors with an initial public offering of shares in a few months.

Founder and CEO Andrew Williams is eyeing July for the IPO, saying the necessary paperwork is already with securities market regulator Financial Services Commission, whose sign-off on the company’s prospectus is required before investors can be approached with the offer.

Williams is not saying how much he hopes to raise but is looking for enough funds to expand Regency’s LPG or cooking gas business and to build gas stations as the company enters fuel distribution.

Regency entered the increasingly competitive LPG retail market in mid-2018, a trade dominated by the likes of Petcom with its Cookie brand, Massy Gas with Gaspro, and Industrial Gases with IGL Blue. However, both Regency and Texaco’s Yaadman brand appear to be holding their own.

Williams’ track record in the LPG market predates Regency. As the owner of a retail operation called Central Supplies and Construction located in Savanna-la-Mar, Westmoreland, he formerly distributed the three cooking-gas brands. He used the network developed under Central Supplies as market channel for his own RPL product.

Regency distributes gas to the western parishes of Westmoreland, St Elizabeth, Hanover, and parts of St James and recently expanded into Portmore and Kingston.

Williams says he invested over $100 million in setting up Regency Petroleum, which includes an LPG filling plant located at Crawford in St Elizabeth and trucks for transporting LPG and cylinders. The plant has the capacity to fill 1,500 cylinders per day, using two work shifts. Another filling plant, already with approvals, is on the cards. Williams is not disclosing the location at this time for competitive reasons. More money has also been pumped into the business to buy more domestic cooking gas cylinders and open another front in the commercial cooking gas market using three delivery trucks also known as bobtails.

“We originally started with the 25-pound cylinder, and we’re now up to 100 pounds, he said. “In addition, we’re selling a lot of bulk gas all over Jamaica to restaurants, hotels, bakeries, and other institutions,” Williams.

The company also operates a mobile gas station that is currently located at 93 Great Georges St at Imperial Plaza in Savanna-la-Mar. It is normally open between 6 a.m. and 7 p.m., drawing a steady stream of customers from among route-taxi operators.

Williams says he wants to capitalise on his gains in the fuels market by building two new gas stations, the first of which is to be located in Negril on the Nonpariel Road. The second will be located in Savanna-la-Mar.

The Negril complex will feature a plaza, a gas station with convenience store, and office space for rent.

Williams has credited Regency’s financial adviser, Mayberry Investments Limited, for suggesting that the company focus on LPG rather than its other lines of business such as lubricants.

neville.graham@gleanerjm.com