Friday, December 29, 2017

Business: WISYNCO Goes "Boom!" on Jamaica Stock Market With Biggest Ever IPO

Wisynco Group Ltd made history yesterday as it listed on the Jamaica Stock Exchange (JSE) Main Market with $6.17 billion in equity, the single largest amount secured from investors in Jamaica through an initial public offering (IPO). 
WISYNCO principals William Mahfood (seated right) and Andrew Mahfood (standing left)

“I wish to commend Wisynco for taking the decision to offer 184.5 million ordinary shares to the public to raise $6.174 billion… And the $3.75 billion [in] shares on the market this morning will ensure that we have greater capitalisation,” Marlene Street Forrest, managing director of the JSE, stated.

“We want to encourage those people who did not get through…at the initial stage, to take advantage of the secondary market, because that is what the market is about,” she continued.

On Wednesday, December 6, Wisynco invited the purchase of 149,414,576 ordinary shares at $7.87 by IPO. Another 314,700,000 shares were reserved for employees (112,500,000), “strategic investors” (150,000,000) and stock broker, NCB Capital Markets (52,200,000).

Two days later, on December 8, the IPO was closed due to being oversubscribed by almost triple the amount being asked for, with more than 10,000 applications amounting to $19 billion, according to Herbert Hall, AVP, investment banking at NCB Capital Markets.

From the applications received, some 7,700 were approved, which included 900 for Wisynco employees.
“This is the single largest transaction that NCB Capital Markets has done in terms of listing on the market… It shows that Wisynco is a household name in Jamaica and the company is poised not only to continue to expand into the minds and hearts of Jamaicans, but across the region, to drive growth and give investors a great return on their investments,” the banker said.

Street Forrest noted, too, that the funds raised by Wisynco Group Limited contributed to the exchange raising the highest amount in a calendar year in 2017.

“Since the start of the year, Wisynco is the 11th company to list its preference shares on either the main or the Junior Market, so the message is going out to look at the equities market. And also, what we have done in terms of the amount raised over the period, we have raised $15 billion. That's significant because it's the largest we have raised in any single year,” she explained.

The listing of Wisynco Group Limited brings the total number of listed companies on the Main Market to 35 and total listed securities to 46. In total, there are 70 companies listed on the JSE's indices — Main Market, Junior Market and USD Market — with 95 securities represented.

The JSE managing director said that the aim was for 100 securities to be listed by year-end. However, she looks forward to achieving that goal before mid-2018. The addition of Victoria Mutual Investment Limited to the JSE today will bring the JSE closer to that goal.

On another historic note, Street Forrest explained that listing on the JSE usually ends between October and November of each year. As such, the listing of Wisynco and other companies during the month of December is a novelty for the exchange, which “speaks not only to the ambition of [Wisynco] to test the market, but the appetite of investors for this company”.

While encouraging other privately owned companies “to come to market”, Street Forrest segued to urge the Government of Jamaica to do the same with State-run companies.

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