Apr 2004 Financial News

Capital & Credit, NCB front-runners for Ja Unit Trust

Apr 14, 2004

Ryland Campbell's Capital & Credit Merchant Bank and NCB Capital Markets have emerged as the front-runners in the bid for the government's 92.7 per cent shareholding in the Jamaica Unit Trust (JUT), usually reliable sources have told the Business Observer.

Our sources say that all the prospective purchasers met the conditions of the bid which opened on March 15, but that NCB Capital Markets and Capital & Credit had offered the highest price for the company. The bid amounts on all proposals vary widely, the source said, with some investors not including the completion of due diligence as a conditionality of their offer.

Six firms tendered proposals for the majority shareholding in the countries' first unit trust: Grace, Kennedy & Company Limited, the Victoria Mutual Building Society, Dehring Bunting & Golding, Guardian Holdings Limited, NCB Capitial Markets, and Captial & Credit Merchant Bank.

The Financial Institutions Services (FIS) has reportedly completed its analysis of the bids which will be presented to a selection committee. A chairman has not yet been chosen, but the committee will include representatives of Mutual Life and the Jamaica Development Bank and will meet "after the holidays".

The recommendations of the committee will be presented to Cabinet for final selection.

In addition to securing the licence, the successful bidder will acquire JUT's substantial client bases of more than 15,000 unit account holders.

Established in 1971, the potential to grow JUT's client bases is thought to be substantial as more than 50 per cent of its account holders have balances below $100,000.

The JUT operates three funds: an income and growth fund, a capital growth fund, and a guilt edge fund.

FIS the precurser to Finsac acquired the 92.7 per cent shareholding in JUT after with the collapse of the former Mutual Life which held approximately 55.7 per cent of the shares in the unit trust. The remaining 37 per cent is being sold by FIS on behalf of Jamaica Development Bank.

Source: Jamaica Observer
http://www.jamaicaobserver.com/magazines/Business/html/20040406T230000-0500_58212_OBS_CAPITAL___CREDIT__NCB_FRONT_RUNNERS_FOR_JA_UNIT_TRUST.asp