MICRO-LENDING outfit Access Financial Services plans to raise $102 million by offering a nine per cent bond aimed at fuelling its growth and working capital needs.
The offer will open next Tuesday and run for a week with plans to list on the new Bond Market of the Jamaica Stock Exchange (JSE).
Access and beverage company Jamaican Teas plans to list the first bonds on the new market platform in quick succession.
"The company intends to use the proceeds of the issue of the notes in order to expand its loan portfolio and for working capital and general corporate purposes," stated the prospectus posted to the JSE's website on Wednesday.
"The company intends to make application to the JSE for the notes to be listed on the Bond Market trading platform."
Access expects to list the bond within one week of the October 15 closing date. The prospectus indicates that the bond principal will be payable on maturity in November 2014, "on the date falling 13 months after issue of the notes". Interest will be due and payable six months from the issue date, in April 2014, and then any remaining interest shall be payable on maturity.
Access made $58 million net profit for its June quarter 2013 or some 22 per cent more than year-earlier levels. It also holds $37.1 million in cash and equivalents at June 2013, but that was far less than the $137 million a year earlier.
"In the current financial year, the company is implementing strategies to improve operational efficiencies and also focusing on continuous product development and enhancement," stated the prospectus about its operations.
Access, which began in 2000, operates 15 outlets islandwide. It was the first company to list on the Junior Stock Market in 2009. The company's loans portfolio grew from under $100 million in 2000 to a net loan portfolio of $801 million at the end of December 2012. Since inception, Access had disbursed in excess of $5 billion in loans. It currently holds $540 million in equity.
The major shareholders in Access are Marcus James, founder and CEO with some 40.1 per cent; Mayberry West Indies Ltd with 38.3 per cent, Schusui Holdings Limited with five per cent and Springhill Holdings Limited with 2.75 per cent.
The JSE launched its bond platform in June this year offering lower fees to attract investors and the Government of Jamaica bond listings. The JSE previously listed bonds but had few listings and trades. As such, the exchange launched a new platform and slashed associated fees from 20 basis points to one basis point on bond trades, data from the launch indicates. Brokers would add on their own added fees.
The bond market platform opened without a listing — but at its launch JSE head Marlene Street Forrest recalled that the successful Junior Market also launched without a listing back in 2009.