Business

Boom! Wisynco plans $1-B IPO

BY KARENA BENNETT
Business reporter
bennettk@jamaicaobserver.com

Friday, November 03, 2017

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Local manufacturer and distributor Wisynco is looking to raise just over $1 billion in new funds by year end.

The company, which announced its plan for an initial public offering (IPO) by way of a press release yesterday, says the listing of its shares will allow the company to share the growth and success of the business with a wide cross section of customers and employees, particularly following on the outpouring of wishes and support after the massive fire last year.

Chairman of Wisynco Group William Mahfood told the Jamaica Observer that the planned IPO consists of two components: the raising of new funds for future investment and expansion, as well as the proposed sale of shares by existing shareholders.

“All this is subject to approval by the JSE and Financial Services Commission, so the selling or listing of any shares will not be able to take place until the regulators approve the arrangement and the prospectus,” Mahfood said.

“We are hoping that the regulators will assist in moving it forward and, if so, we are hoping to have the company listed or at least the IPO released to the public between now and December,” he continued.

Mahfood, in explaining what the proceeds of the funds will be used for, told the Caribbean Business Report that high on the list of priorities is the establishment of the new production line. Earlier this year the company announced plans to build a beverage plant valued at US$8 million by March 2018.

The build-out is expected to increase production numbers by 50 per cent as the company seeks to take on the Caribbean.

Wisynco is also looking to use another portion of the funds raised for the construction of a 25,000-square-feet storage facility in Lakes Pen, St Catherine, following the fire last year.

“Some of it is to look at the possibility to expand our western distribution centre and some will be used for debt repayment,” Mahfood reasoned.

Wisynco has engaged NCB Capital Market as arranger and broker for the transaction with PricewaterhouseCoopers acting as financial advisors to the company.

Founded in 1965 by the Mahfood family, West Indies Synthetics Company (Wisynco) Limited began manufacturing 'Iron Man' water boots from a 6,000-square-foot factory in Twickenham Park, St Catherine.

The company soon evolved to offer a full-range of footwear for men and children, the production of cups and containers, and the distribution of imported beverages from Trinidad.

Today Wisynco owns and manufactures a portfolio of beverage brands such as WATA and its expansion of cranberry flavoured-WATA, BOOM! Energy Drink, and BIGGA Soft Drink. In addition to its own brands, Wisynco is the exclusive local bottler for the Coca-Cola Company as well as third-party beverage brands such as Squeezz and Hawaiian Punch; also distributing for global giants such as Red Bull, Kellogg's, General Mills, and Nestlé.

In 2014, Wisynco purchased a 50 per cent share in United Estates Ltd & Trade Winds Citrus Ltd, which produces local brands such as TruJuice and Freshhh. The company is also the local franchise holders for Wendy's and Domino's restaurants.

Over the years Wisynco has increased sales significantly, moving from $12.6 billion in 2013 to $21.2 billion in 2017.

Since 2012, the company's year-to-year sales growth has ranged up to 21 per cent with a compound annual growth rate of 11.06 per cent over the same period. The business additionally boasts strong gross profit margins, averaging approximately 36 per cent since 2012.

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