NCB to make new offer for Guardian Holdings shares

NCB Financial Group Limited (NCB), which operates one of the largest financial entities in the region, will make another bid for additional shares in regional insurance conglomerate Guardian Holdings Limited of Trinidad (GHL) following a determination by the Trinidad and Tobago Securities and Exchange Commission (TTSEC ) and agreement by a minority shareholder group including Peter Permell, an activist investor who has led in championing the minority shareholders.

The timeline for the new offer remains undisclosed.

The TTSEC, in a release on Friday, stated that a "settlement has been agreed" between the parties." It will result in NCB Global Holdings (NCBGH)n agreeing to make a new offer to GHL shareholders at a price of US$2.65 per share, stated TTSEC. NCB Financial, through NCBGH, originally made the offer for the additional shares in Guardian Holdings at US$2.35 each.

IF ACCEPTED

The regulator said that the offer, if accepted, would result in NCBGH holding up to 51.85 per cent but not less than 50.01 per cent of the issued and outstanding GHL shares. That equates to US$120.24 million, or 115.97 million units.

The TTSEC stated that it is up to NCBGH to determine the timeline for a new offer. NCBGH originally sought to purchase shares at US$2.35 each for a total value of US$174 million. The price, however, was nearly US$1 below the US$3.24 per share that NCB paid for its initial stake in a deal with key shareholders, including Arthur Lok Jack and Imtiaz Ahamad, that closed in May 2016.

The price difference has upset minority shareholders who challenged NCBGH to make an offer that matched the price offered to key shareholders. It led to complaints being lodged with the TTSEC by a group of minority shareholders of GHL headed by Permell.

"The staff of the SEC and NCBGH agree that the settlement will achieve the appropriate objectives in the public interest," said the Securities and Exchange Commission. "For the staff of the commission, the settlement will preserve the interests of the public and will bring certainty to the local capital markets and the shareholders of GHL," added the TTSEC, noting that Permell was persuaded on the oral and written statements and advice from his legal counsel.

Permell and NCB did not respond to messages sent by the Financial Gleaner up to late on Friday.

NCB currently holds 29.99 per cent of GHL shares for which it paid J$28 billion. NCBGH originally aimed to acquire up to 62 per cent of GHL but will now seek no more than 51.85 per cent. The basis of the reduction in the amount was not disclosed.

ALLEGED BREACH

Complaints were filed against NCB with the TTSEC by minority owners of Guardian shares, who alleged a breach of Trinidad's bylaws for takeovers and were pushing for the Jamaican bank to adjust the offer price more in line with what it initially paid large shareholders for a stake in Guardian in 2016.

The offer to take up to 62 per cent of GHL shares was extended for three weeks to February 2, this year, but it lapsed.

steven.jackson@gleanerjm.com