Dequity Capital acquires stake in Pinnacle insurance brokerage
Published:Friday | October 4, 2024 | 12:06 AMNeville Graham - Business Reporter
Investment firm Dequity Capital Management has acquired a 25 per cent stake in Pinnacle Insurance Brokers
Dequity Capital CEO Kadeen Mairs said the shareholding in Pinnacle was acquired for $45 million, which, given the insurance brokerage’s $350-million valuation, was secured at a bargain price.
“Yes, definitely, we got a bargain there,” Mairs told the Financial Gleaner, adding that the 25 per cent stake came via the issuance of new shares.
In addition to the cash payment, Dequity will loan Pinnacle additional funds for expansion and facilitate access to channels within its portfolio of invested companies. That access, according to Mairs, was factored in the pricing of the Pinnacle shares sold to Dequity.
“As an example, we’ll soon be expanding our presence in Montego Bay, where we have a money services and cambio operation in M24. Pinnacle can be a part of that by having a representative office there, offering all their products. Those are the kinds of synergies which allowed us to get a discount on the cash-buy,” Mairs said. M24 was founded by Mairs and is now run by Teno Mair, its website shows.
Tourists who purchase travel health insurance through Pinnacle will have access to the health facilities in the Dequity Group, the CEO added.
Founded by former Jamaican cricket captain Mark Churchhill Neita in January 2013, Pinnacle deals in life, health, motor, business, and travel insurance, both locally and internationally. Its ownership prior to the current deal was split among Fred Schaechter, 50 per cent; Mark Neita, 25 per cent; and Mark Churchhill Neita, 25 per cent, Companies Office of Jamaica records show.
Licensed by insurance regulator Financial Services Commission, Pinnacle holds a facultative licence, and provides a type of reinsurance that covers a single risk or a block of risks in specialised international life and health insurance.
Neita declined to comment on the company’s earnings, saying it’s finances were private.
“We’re not prepared to give anything on revenues at this time, but what we can say is that we are hoping that the synergies will work in this partnership, and I have no doubt that they will,” he told the Financial Gleaner.
“Through Dequity we will have access to several market segments, and this will bolster our revenue growth,” Neita said.
Dequity Capital now has in excess of US$45 million in assets under management across nine portfolio companies engaged in real estate development, financial services and healthcare, Mairs said. The invested companies include Royale Hospital in Savanna-la-Mar, Westmoreland; Winchester Medical Centre in Kingston; telemedicine company MDLink; and microlender Dolla Financial Services Limited.
Dequity Capital generally invests in small to medium companies, which it assists with building out their corporate governance structures and strengthening organisational structures.
“Through this partnership, Dequity aims to increase Pinnacle’s net earnings and position the company for a future listing on the junior market of the Jamaica Stock Exchange,” Mairs said.
“Just by plugging Pinnacle into our diverse group of companies, we already project a 20 per cent revenue increase,” he said. “We see immense potential in Pinnacle and are excited to support their expansion into new business lines and markets.”