DERRIMON Trading’s initial public offering (IPO) closed three minutes after opening Monday morning.

The invitation to buy shares was oversubscribed, but lead broker Mayberry Investments had not calculated by how much up to press time.

However, applicants will learn the basis of their allotments by tomorrow, while the application to list the shares on the Jamaica Stock Exchange (JSE) has already been done.

“(Derrimon) has made application to list the shares on the Junior Market of the JSE but makes no guarantee that the shares will be so listed,” said a press statement issued by Mayberry.

The early closure of the week-long IPO meant that the distributor, which also operates four Sampars Cash ‘N’ Carry stores across the island, successfully raised the targeted $150 million.

Derrimon plans to use the proceeds of the IPO to expand its network of outlets, retire debt, upgrade software, and provide working capital.

In the offer of 26.8 per cent of the company, Derrimon reserved a three per cent stake for its employees and a further 4.5 per cent of the shares for key suppliers and customers.

Just over 9.4 per cent of the shares are being issued to repay $52.7 million in loans that were made by three directors of the company — Derrick Cotterell, Monique Cotterell and Ian Kelly — who may have opted to convert the loans to the shares issued in the IPO.

Most of the directors’ loans — $45 million — derived from debt-driven expansion since the start of 2013, which saw the company increase its overall debt from $74 million (excluding payables) at the end of 2012 to $250 million at the end of August.

More specifically, it purchased equipment associated with the acquisition of Sampars Mandeville Outlet, replaced cold room equipment and undertook other expansion at the main warehouse at Marcus Garvey Drive, while increasing inventory levels.

Derrimon grew its revenue base from $807 million five years ago to $4.7 billion last year, while sales were up by 13 per cent during the first eight months of 2013.

During that time, it acquired Sampars and established three further satellite outlets in its bid to increase vertical integration and retail market penetration.

Pre-tax profit also climbed from $8 million in 2008 to $36 million in 2011, before falling to $25 million last year due to increased finance costs, from $9 million in 2011 to nearly $20 million last year. It also saw gains on foreign exchange fall from $23 million in 2011 to $230,000 last year.

Derrimon operates primarily from its facility located on Marcus Garvey Drive. However, its distribution network extends islandwide. Its warehouse facility of approximately 100,000 square feet sits on 3.5 acres of land and is less than two miles from the port of Kingston. Its capital base stood at $140 million as at August 31, 2013.