Cutting off the offer one working day ahead of its intended close date, having hit the intended target, Access Financial Services Limited closed its initial public offer on Friday and is just two to three weeks away from becoming the first stock to list on Jamaica's nascent junior market.
"We raised the $100 million intended and will now move to list," said Marcus James, chief executive officer of Access Financial.
Access took in $100.195 million for the 5,490,199 shares on offer - effectively divesting 20 per cent of the company - with listing anticipated on the Junior Stock Exchange by the first week in November.
Access Financial had indicated in its prospectus that even if the IPO had only garnered half its target or $50 million, the listing on the seven-month-old junior market would have proceeded within a week of the closing date.
The company, a provider of micro, small and medium-size business loans and personal loans, opened its IPO to the market on October 14. The offer was to have closed Tuesday, October 20, allowing for Monday's Heroes Day holiday, but was pulled October 16.
Target market
"Our products are well suited for our target market and we will now be seeking to increase our market share," said James.
The take-up of the shares was from a mix of retail and institutional investors but the proportions were not disclosed.
Of the 5.49 million ordinary shares, more than 5.325 million units were offered to the public at $18.34 per share, while 164,706 units were reserved for priority applicants, including directors and managers, at a price of $14.58.
Another 4,400 reserved shares were also made available to employees at a discounted price of $1 per share sold in blocks of 50.
The IPO was set to be closed October 20.
Prior to the close of subscription, though not expecting the offer to fail, some analysts exhibited concern over the price at which the shares were valued, saying the offer was too expensive, while others predicted that with the growth prospects for the company, take-up would have been robust at the quoted price.
The latter were proved right on the market's response.
"It's a good IPO, the valuation of the stock is in line with other entities in the market," said John Jackson, financial analyst.
But said another analyst who requested anonymity: "A number of clients agree that the offer price was unreasonable and would rather own a share of a cheaper stock with a longer track record of performance."
With the full take-up of the Access shares, Mayberry Investment Limited, sole broker to the offer, will see its holding in the company diluted to 39 per cent from its previously held 49 per cent.
James, the founder and CEO of Access, remains majority owner but his stake will fall to 41 per cent, down from 51 per cent.
Mayberry CEO, Gary Peart, said in a company issued statement that the company was pleased to be part of history.
sabrina.gordon@gleanerjm.com