Dec 2015 Financial News

NCBJ now owns 29.9% of Guardian Group

Dec 01, 2015

Jamaica’s largest bank by assets, NCBJ, yesterday consummated the acquisition of a 29.9 per cent stake in T&T’s largest insurance company, Guardian Group, for an undisclosed sum.

The stake purchased by NCBJ, whose majority shareholder is Jamaican billionaire Michael Lee Chin, is significant because it is just under the 30 per cent threshold that would have triggered a mandatory takeover bid for all of Guardian Group’s outstanding shares.

The transaction involved the Lok Jack and Ahamad families selling most of their stake in Guardian Group to NCBJ through a private sale. Also selling some of its shares to NCBJ was the International Finance Corporation (IFC), the World Bank affiliate that invested US$75 million in Guardian Group in 2010.

The transaction also involved the Lok Jack and Ahamad families buying back the 12 per cent stake in GHL held by the Royal Bank of Canada (RBC) and IFC’s remaining shares, leading to the exit from Guardian Group of its two blue-chip foreign investors.

The result would be that NCBJ is GHL’s largest single shareholder; the Lok Jack and Ahamad families would jointly be the second largest shareholding block with a 22 per cent stake and both RBC and the IFC have ended their shareholding relationship with the Westmoorings-based insurance company.

The completion of the transaction is subject to it receiving all necessary regulatory approvals in T&T and in Jamaica.

Addressing financial analysts, stockbrokers and journalists at a briefing at the Hyatt yesterday, GHL chairman Arthur Lok Jack said: “I am very happy that we have achieved a regional solution. In the process we have replaced two shareholders desiring exits with shareholders who are eager to support the growth and expansion of the Guardian Group.”

The NCBJ acquisition of the significant stake in GHL will see Lok Jack remain as the chairman of the GHL board and the majority of the board will continue to be independent directors, according to a Guardian Group statement released at yesterday’s briefing.

Speaking at the briefing yesterday, Lee Chin compared how he felt yesterday “nervous and excited” with his feeling on March 22, 2002, when he signed to purchase a 75 per cent stake in NCBJ from the Government of Jamaica, through a resolution company called FINSAC, which was then headed by Patrick Hylton.

Yesterday, Hylton, who is now the group managing director of NCBJ, said the investment by the Jamaican bank in the T&T insurance company created significant opportunities for growth.

Guardian Group CEO Ravi Tewari said: “The alignment of NCBJ and GHL is a very positive development and holds great opportunity for our shareholders, our clients and our employees.”

For the 12-month period ending September 30, 2015, NCBJ declared a net profit of J$12.3 billion, which works out to be about US$102 million, from assets of J$523.8 billion (about US$4.4 billion). At its December 2014 year end, Guardian Group’s net profit was $400 million (US$63 million).

Source:
Trinidad Guardian
Tuesday December 1, 2015

http://www.guardian.co.tt/business/2015-11-30/ncbj-now-owns-299-guardian-group