Dec 2005 Financial News

N & M, Issa tight lipped about Shell buyout in Jamaica

Dec 07, 2005

WHILE NEWS out of Jamaica last Thursday said that Joe Issa has "plans to take public, Cool Petroleum Holdings", the vehicle created by his and Trinidad's Neal and Massy Holdings' (N&M) partnership, to acquire Shell Oil's Jamaica business, N&M's executives here remained tight lipped on the topic.

A story carried in the Jamaica Observer said that Issa declined comment on the issue, saying that its sources said he had "already signalled to key strategists" his intention to commence work on an IPO, once the acquisition of the Shell assets were finalised and he began to settle down on the operation.

However, Business Express was informed by experts in the energy sector, that Neal and Massy had a team on the reggae island last week "firming up on the acquisition deal of Shell Oil with Issa", but the experts were blatantly skeptical, that N&M would support any IPO, even though Issa's intent is to take his side of the deal public.

"It's a complex deal and cutting down the middle is not as simple as Issa may think... the other party, N&M's interest is too tied in for him to be able to slice cleanly and go public," one source explained to Business Express.

The Jamaica Observer story said: "The buying of Shell's Jamaican business was a leveraged deal," said one source.

"Going public would raise capital which could be used to write down debt and de-leverage Cool Group's balance sheet."

The Observer reporter said that sources made it clear that it would just be the petroleum side (Joe Issa's interest) of the partnership that would be taken public and not the entire group.

"Issa and his partner, N&M, are estimated to have paid about US$180 million for Shell's commercial fuel, lubricants, liquefied petroleum gas (LPG) and chemical business in Jamaica - fifty-six service stations came with the deal.

"Issa's Cool Oasis brand operates another 30 service stations. Neither Issa nor Neal and Massy has made public the specific structure of their partnership, but according to Business Observer sources, Issa hold's controlling interest in Cool Petroleum Holdings," the story said.


Roxanne Stapleton
The Trinidad Express
Business Magazine
Wednesday, 7th December, 2005
http://www.trinidadexpress.com/index.pl/article_business_mag?id=121009459