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Financial News

Jan 2008 Financial News

Angostura to sell off Lascelles' minor subsidiaries

Jan 25, 2008

The more significant subsidiaries of Lascelles de Mercado (Lascelles) are to be listed on the regional stock exchanges or sold off with the proceeds distributed to Lascelles shareholders once Angostura takes control of the firm.

In an exclusive interview with Caribbean Business Report, Michael Carballo, Executive Director of Angostura, outlined his company's plans for Lascelles' numerous divisions.

In regard to Lascelles Merchandise Limited, Ajas Limited, John Crook Limited and Transportation Agencies Limited, Carballo stated that, "It is early days, but there is a strong possibility that these prime assets will be disposed of and proceeds distributed as dividends to shareholders of Lascelles."

In regards to Lascelles subsidiary, Globe Insurance, Carballo stated, "It is our intention to keep the Globe Insurance business and expand into other classes and list this entity on the Jamaica Stock Exchange, with the value extracted being returned to shareholders."

Local favourite Wray & Nephew will be merged with Angostura. "Within 12 to 18 months after completion of the Lascelles take-over," Carballo explained, "we will seek to merge Wray & Nephew and Angostura and relist the merged entity on both the Trinidad and Jamaica Stock Exchanges."

It is expected that the pared down Lascelles will focus on bringing the Appleton brand to further prominence on the world market.
"We feel that if we can get the Appleton Brand up to at least 2 million cases, it will place a brand valuation of at least US$1 billion, and I think that this is conservative based on other acquisitions." Carballo continued, "When Grey Goose was sold to Bacardi, it was doing 1.8 million cases, primarily in the US and was sold for in excess of US$2 billion. Appleton is a global brand and we must not feel that because it is produced in rural St. Elizabeth that it does not have great value."

The impending take-over of Lascelles by Angostura has created concern that one of Jamaica's unique brands is being sold out to a company based in another country. The argument is that Jamaica's loss is Trinidad's gain. Carballo addressed this assertion: "While this is one of Jamaica's greatest brands, only the home base of the major shareholder is changing. Appleton and Lascelles will continue to be as Jamaican as ever before." He insisted that such sales are the order of the day. "Transfers of ownership in today's environment is a result of globalisation. This is inevitable."

He also noted that, "No longer can the Caribbean think on an insular basis. We must have a global perspective when it comes to business if we in the Caribbean are to effectively compete on the world stage. What would have been the situation if Kentucky Fried Chicken had not sought to spread its wings and take its brand outside of Kentucky State?"



Source:
The Jamaica Observer
Friday 25th January, 2008

http://www.jamaicaobserver.com/magazines/Business/html/20080124T200000-0500_131787_OBS_ANGOSTURA_TO_SELL_OFF_LASCELLES__MINOR_SUBSIDIARIES_.asp