Business

SOS seeks $95m via IPO

BY KARENA BENNETT
Business reporter
bennettk@jamaicaobserver.com

Wednesday, July 05, 2017

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Stationery and Office Supplies Limited (SOS) is seeking to raise $95 million through an initial public offering (IPO) on the Jamaica Stock Exchange.

The company, through its IPO, which runs from July 19 to 26, is inviting subscriptions for up to 50,024,100 shares from the general public and reserved share applicants, with 27,524,100 shares available for subscription by the general public at a cost of $2.00 per share and another 22,500,000 reserved shares at a discounted price of $1.20.

At more than 50 years old, SOS will be the oldest company to list on the Junior Market of the Jamaica Stock Exchange and the first of its kind to list on the Junior Market.

According to the prospectus, the proceeds of the invitation will be used to provide stock and working capital support valuing $16 million, and to liquidate debt obligations of $31 million.

SOS, which currently operates out of a 35,000-square foot warehouse, office and showroom at 21-25 Beechwood Avenue in Kingston, is also looking to acquire a property adjoining its location in Kingston at 34 Collins Green Avenue, for additional warehousing space valued at $36 million.

The company estimates that the remaining $12 million will be used to cover the expense of the invitation. SOS has retained the services of JN Fund Managers.

“The directors believe that this capital injection into the company will afford it the opportunity to create sufficient working capital to facilitate it increasing the stock levels of its fast-moving items, which will allow it to increase the turnover of its stock and thereby its revenues,” Managing Director David McDaniel stated in the prospectus.

The stationery supplies company opened its doors back in 1965 under the guidance of Richard Hing, George Hew, and David McDaniel. The company currently employes 83 people in Kingston.

In 2010 it expanded to the Fairview Office Complex, Montego Bay, opening a 3,000- square foot facility to serve the western end of the island. That location houses 1,200 square feet of office and showroom space and a 1,800-square foot warehousing facility supported by a staff complement of 16.

Over the last six years, SOS has expanded from its core business of office supplies and stationery items to include modular office furniture, partitions, metal products, chairs, cabinets, and shelving. The company currently carries leading international brands in office furniture — Fursys and Boss — for which they are the sole local distributors.

SOS has also added commercial shredding to its suite of services offered to the general public.

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