Stockbrokerage firm Mayberry Investments Limited's acquisition of Access Financial Services Limited, a financing company, represents the firm's official foray into venture capitalism.

Mayberry and Access Financial Services Building

"We have taken a 49 per cent stake in the company and will use our connections in the industry to grow the firm. Within five years, we expect the company to be at a point where we can either list it on the Jamaica Stock Exchange or offer an equity stake to other interested parties," said the company in a press release.

On Wednesday, Mayberry announced that the company had acquired, at a cost of $38 million, a 49 per cent interest in Access, a six-year-old financing company, specialising in loans to small and micro businesses as well as to individuals.

Access provides loans ranging from $5,000 to $350,000 to small businesses and from $5,000 to $200,000 to individuals. The company currently has a loan portfolio in excess of $108 million.
"Access is in a space that is underserved; the demand is there based on the market niche," said Gary Peart, Mayberry's chief executive officer.
Mayberry will benefit on the interest income from loans booked by Access.

"With 49 per cent shareholding on a quarterly basis we would book the profit in your profit and loss statement," Peart explained. "Access provides a diversification of our revenue stream that doesn't have to come directly from Mayberry."

In the release, Mayberry explained how Access's business works:
"Loans to businesses are secured by physical assets and those to individuals are guaranteed through payroll deductions. With a total staff complement of 40, the company currently operates from its head office at 41B Half-Way- Tree Road in Kingston and from six branch offices in Montego Bay, Ocho Rios, Mandeville, Spanish Town, Portmore and Morant Bay."

Interestingly, Mayberry will not be cross -selling its products to Access clients. "We will have a seat on the board, but we will not be a part of day-to-day management," Peart said. "And we will not be selling Mayberry products."

Added Peart: "Our participation in Access Financial Services Limited is in keeping with our commitment to provide financing opportunities for small businesses in Jamaica, as stated by our chairman, Christopher Berry in April last year when we became a publicly listed company."
Peart also said that Mayberry expects this transaction to be accretive to earnings in year one. According to Marcus James, founder and principal shareholder of Access Financial Services Limited, the company currently has close to 4,000 clients, with a better than 90 per cent repayment ratio.

Access has applied for approved agency status under the government's programme to provide loan financing to the small business sector and, "if granted," said James, "we expect this will contribute strong growth to our client base."
"Most importantly," added James, "we believe that our relationship with Mayberry will strengthen our financial product development and service delivery capabilities, making it possible for us to develop and sustain even stronger relationships with our target market."

There are about 105,000 small and micro enterprises in Jamaica, employing an estimated 357,000 persons or about three persons per entity. Most of these businesses or individuals are unable to access the more established credit sources either because they cannot meet the criteria of the traditional lenders, most often than not, falling short of the required collateral. Christopher Berry and Gary Peart have been appointed to the board of Access Financial Services Limited to sit along with the two existing directors. The parties intend to appoint an independent chairman in the near future.

The Access deal isn't the end of Mayberry's ambitions.
"We want to identify other companies like Access. It is not necessary that we take minority stakes as we did in this case," said Peart. "We are also interested in acquiring other companies and have existing management run it. We are still on the look out for opportunities."

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