Tetley Tea hopes to float 20 per cent of its ordinary shares on the Jamaica Stock Exchange (JSE) Junior Market to raise the $100 million it has been eyeing to expand its business.

On Monday, lead broker Mayberry Investments Limited (MIL) made the announcement that the tea maker would take the route of listing, adding that should an initial public offer be successful the firm will be listed by the second quarter of this year.

Tetley principal, John Mahfood told the Business Observer that the issue should represent 20 per cent of the shares in the company.

The expansion plan will be aimed at building out warehousing space as the company closes on operating at full capacity, and developing new products, such as barbeque flavoured sauce and coconut milk powder.

Two weeks ago, Mahfood also told the Business Observer that the company wanted “to be in a position to acquire other businesses as the opportunity arises, whether it is tea or other export related products”.

Presently, Tetley Tea is the largest producer of tea in the English speaking Caribbean with a market of 100 million tea bags sold annually. The company exports 40 per cent of the teas produced in Jamaica and sells the remaining 60 per cent locally under its wholly owned brand, Caribbean Dreams. That brand produces herbal tea varieties such as lemon grass and ginger mint. The company produces 40 different types of teas and exports to twenty customers within the Caribbean and North America.

Listing on the JSE has clear benefits, such as a 10-year tax break, however, it also comes responsibilities that includes full disclosure and properly updated financial records. Mahfood said this should not pose a problem for the company, which he and father Adeeb acquired in 1995.

“Fortunately we have always run the company with up to date financial data, regular monthly accounts and formal planning procedures and so on. The main difference will be in the need to do filings and to deal with a registrar,” Mahfood said.

Since 2010 began, Mayberry has already successfully led the initial public offer of one other manufacturing company, Blue Power Group, which announced that the offer was oversubscribed last week. Mahfood said he expects the same response to the Tetley offer.

“The market is very anxious to see more companies listed especially given that rates are so low on fixed income investments,” Mahfood said. “I’m sure that they will be anxious to pick up this offer. Its only $100 million, it’s a small offer.”

The decision to list comes following a strategic assessment of the company undertaken by Mayberry. “We are analysing the balance sheet, looking at the relationship with their suppliers and looking at the best areas to see what is the way to go,” Mayberry CEO Gary Peart told the Business Observer just over a week ago when the decision to expand was announced. At that time, Peart said that Mayberry will be assessing the company to see whether debt or equity investments was more suitable.

It is apparent that the listings strategy was the most viable.

“The Junior market is a win win proposition,” Peart said. “Listing raises capital for expansion; the expansion creates further value for the company and more jobs for the economy which increases the revenue base for government taxes.”

Mahfood is confident the right strategy has been decided to enable Tetley to pursue its expansion aims of extending its product line and acquiring new businesses.

“I think that because Mayberry has done this before — this is now the third time — it’s pretty seamless. They have more experience so the process is an easy process. It really means that everyone knows what they are doing,” Mahfood said.

Last , Mayberry also led Access Financial Services in its IPO, which raised $100 million.