Foote acquires small slice of Fontana from pharmacy family

Astronomical Holdings Limited, AHL, a company led by attorney Able-Don Foote, has acquired around one per cent of pharmacy company Fontana Limited, worth about $100 million, from the family that founded the company.

AHL is now the second largest shareholder in the retail pharmacy chain, behind Burbank Holdings, the company that holds the interest of the Chang family members, and just ahead of Sagicor Select Funds, assuming its holdings have not changed since the last quarterly market disclosure for the period ending September 2021.

“It was a small amount sold,” said Fontana CEO Anne Chang, regarding the share sale to AHL.

The precise number of shares acquired by Astronomical Holdings was not disclosed, but it was said to be the bulk of the 12.9 million Fontana shares that traded last Friday, January 14.

Burbank held 989.17 million of the 1.249 billion ordinary Fontana shares in issue, prior to the sale. Its holdings would likely have fallen to around 976 million units since Friday.

“Structurally, this is proof of concept for further transactions of this nature. We wish to express our gratitude to all those who contributed in making this concept a reality,” Foote said on Monday. “A special thank you to our broker VM Investments, which executed the transaction in a timely manner,” he added.

AHL was incorporated in 2019 but only became operational this year. Foote is the sole director and shareholder. The Companies Office lists Foote as the sole shareholder and director in the company.

The lawyer, who is under 30, is also among the Top 10 owners of another listed company, Express Catering Limited.

Fontana currently operates six pharmacies nationwide, and is setting to add another through its planned entry into Portmore. It’s investing $100 million in the store that’s scheduled for commissioning in 2023 at Braeton Parkway/Municipal Drive.

“From where we sit the asset is prime, as management has virtually doubled the net profit during the pandemic,” said Foote. “Moreover, with Fontana’s imminent expansion into Portmore, and the economy of St Catherine being a strong one with inhabitants in excess of 400,000 persons from Portmore and Spanish Town, we expect to see significant growth to their already strong top line which is in excess of $5 billion. Fontana is expected to reap continued benefits of economies of scale from their flagship Waterloo location and also Portmore,” he added.

The new store will take design queues from the Fontana operation at Waterloo Square in Kingston, which includes a pharmacy, beauty hub, artisan products, items for children, an extensive home décor collection, a business centre, a courier counter, and provides over 200 parking spaces for customers. The Waterloo complex has been highly popular and heavily trafficked since its opening in 2019.

Fontana was founded five decades ago but only went public in 2018. At year ending June 2021, amid the continuing COVID-19 pandemic, the pharmacy company nearly doubled its earnings from $276 million to $512 million.

On Tuesday, the Fontana stock closed up 3.5 per cent at $7.68 per share, valuing the company at $9.6 billion or more than five times its book value.

business@gleanerjm.com