Mayberry exercises $4 million stock option in Lasco
Mayberry Investments Limited (MIL) has chosen to exercise its over $4 million stock option in the three Lasco companies which recently listed on the Junior Market of the Jamaica Stock Exchange. The decision to exercise the stock option was confirmed on Thursday by MIL’s senior manager, research and special projects, Tania Waldron-Gooden.
Conventional wisdom holds that you should sit on your options until they are about to expire to allow the stock to appreciate and, therefore, maximise your gain. However, Waldron-Gooden told Caribbean Business Report (CBR) that MIL’s decision to exercise the option, almost two years before its stipulated expiration indicates the tremendous value of the Lasco stock.
“It just shows the value of the company and that we expect it to continue to grow and perform well in the future,” Waldron-Gooden said.
The option gives the holder the right to buy the stock at a stipulated exercise price and stated date. MIL’s option is to buy at the invitation price of $2.50 each, 235,299 shares in Lasco Financial, 783,091 shares of Lasco Manufacturing and 643,899 shares of Lasco Distributors Limited. The shares are valued at $588,247.50, $1,957,727.50 and $1,609,722.50 respectively. The exercise date as stated in the prospectus, is September 15, 2012, however, MIL announced its decision to exercise the option less than a month after it was offered on October 5, 2010.
The decision to exercise now has reaped some financial benefits for Mayberry as the stocks in all three companies of the Lasco affiliates have appreciated on average 20 per cent since the listing. On Thursday Lasco Distributors traded at $3.20, Lasco Financial at 2.71 and Lasco Manufacturing at $3.50.
Lasco’s performance on the Junior Market has so far been phenomenal, with all three listings for the Group jumping by the allowed 15 per cent during the first and second days of trading October 12 and 13. And three minutes after the Initial Public Offer (IPO) was opened on September 15, shares of the three companies within the Lasco Group were oversubscribed.
Waldron-Gooden said MIL has a tradition of picking winners and exercising the Lasco option was another such choice.
“The general sense was that we would exercise the option,” Waldron-Gooden said of the Mayberry team. “Because after looking at the numbers and before we went public we decided that this was a good growth company.”
