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Financial News

Aug 2015 Financial News

Sagicor to buy Florida hotel

Aug 05, 2015

Through its Jamaica subsidiary Sagicor Real Estate X Fund Ltd (XFUND), Sagicor has entered into an agreement to acquire for an undisclosed sum a convention hotel in Orlando, Florida, which is affiliated with a major hotel franchise.

Sagicor made the announcement in a July 24 filing on the Jamaica Stock Exchange where it is listed.

Sagicor is listed on stock exchanges in Port of Spain, Kingston, Bridgetown and London.

“The acquisition is slated for completion in next month. XFUND states that the move is in keeping with the company’s investment strategy to seek out real estate investment opportunities outside of Jamaica,” Sagicor said. “The company proposes to finance the acquisition by debt and equity and to this end, its board of directors will convene a meeting on August 3, to consider inter alia, a non-renounceable rights issue to raise the additional equity required,” Sagicor said.

“This move represents the fund’s satisfaction with its Jamaica operations and the pursuit of an opportunity to expand outside of Jamaica through a well established hotel operation, expected to improve returns to shareholders,” Sagicor group chief operating officer Richard Kellman said in reply to e-mailed questions on July 28.

Asked the name of the hotel and the price, Kellman said it could not be disclosed at this time. As for how it will be financed, he expects it will be financed 60 per cent by debt and 40 per cent by equity.

Kellman said: “Our Jamaica operations continue to do well, led by the insurance business that is a consistent generator of increasing profits in US dollars. The newly acquired bank has been successfully absorbed, most of the associated costs have been expensed, and the business has already started to contribute to profits.”

Sagicor Jamaica’s exposure to the hotel industry is via the Sagicor Real Estate XFund which is publicly listed and to which Sagicor pension plans have an exposure. He said the Jewels hotel brand in Jamaica has done well and has recently linked with the Hilton Curio brand for increased exposure.

Kellman said Sagicor’s US$320 million bond issue currently before the market is primarily for refinancing existing debt, and is not for funding of the Xfund’s latest proposed acquisition.

 

Source:
Trinidad Express
Tuesday August 5, 2015

http://www.trinidadexpress.com/20150804/business-magazine/sagicor-to-buy-florida-hotel