JSE CAPITAL MARKETS CONFERENCE 2019
PM wants to turn voters into shareholders
Published:Friday | January 25, 2019 | 11:00 AM
Prime Minister Andrew Holness is urging ordinary Jamaicans to buy shares in state-held Wigton Windfarm Limited when the energy company’s initial public offering comes to market, saying that shareholders are more effective at holding management accountable.
“Experience has shown that shareholders are far more effective at holding the management of the enterprise to account and far more effective at innovation than is the voter,’’ said Holness at the opening ceremony for the 14th annual JSE Capital Markets Conference in New Kingston on Tuesday night. One reason shareholders are more effective is that they have more information than voters, he said.
”It’s absolutely important to ensure that we have a robust stock market to ensure that we can convert the voters into shareholders,” the prime minister said.
Government wants a wide allocation of the Wigton shares to the general public under the IPO, which is being brokered by Mayberry Investments Limited. It would buck the prevailing trend in which the shares of newly listed companies on the Jamaica Stock Exchange tend to be taken up by institutional investors, which are mainly pension funds, while blocks of shares are also often reserved for key interests.
Floating shares
The Jamaican Government also plans to float shares in other entities in which it has ownership, such as assets held by the Urban Development Corporation and those of the Factories Corporation of Jamaica, among others, but none is as advanced as the upcoming Wigton IPO, which is expected to launch before March.
“I am encouraging Jamaicans to buy shares in these public companies when placed on the JSE so they can own assets and share in the profit and gain when these companies are listed,” Holness said, even while cautioning that investors should seek professional advice before deciding which entities to buy.
“Of course, I can understand there is certain conservativeness. But persons in the know are eagerly awaiting these listings, and the average Jamaican can participate,” he said.