Jamaica Gold secures $1.2 billion in financing
Jamaica Cane Products Sales Limited (JCPS) has secured another $1.2 billion in financing for sugar cane reaping from short-term fixed-rate notes through Scotia Investments Jamaica Limited (Scotia Investments).
JCPS is the leading entity authorised to export Jamaican raw sugar and is also the producers of the ‘Jamaica Gold’ brand of sugar.
As arranger and broker to the transaction, Scotia Investments structured the deal to utilise proceeds from the sale of the sugar as security for the borrowing by JCPS. The funds raised will be used by JCPS to fund pre-export working capital for the 2015/2016 sugar crop.
Last year Scotia Investments successfully completed private placements with the company for $2.8 billion in short-term notes.
Vice-President of origination and capital markets at Scotia Investments, Dylan Coke, stated that Scotia Investments is very pleased to have assisted JCPS with a creative funding solution, particularly as it seeks to support sugar manufacturers and cane farmers across Jamaica.
“Scotia Investments is always seeking to use its expertise and international scope to create funding solutions tailored to meet the specific needs of its clients.”
The offer was fully taken up by a small group of institutional investors.
JCPS is a local distributor of domestically produced sugar to international and local buyers. It is a private company, incorporated in 1986, jointly owned by Jamaican sugar manufacturers and cane farmers.
Much of the locally produced sugar is supplied to international entities such as Tate & Lyle Sugars (T&L) under fixed-term contracts.
The fixed payment terms will allow JCPS to use its receivables as security for its borrowings. Under the arrangement, T&L will pay over the sale proceeds to a trustee on behalf of investors.
Up until 2012, JCPS was the sole marketing agent of the Sugar Industry Authority (SIA), and the only entity authorised by the SIA to undertake the commercial functions associated with the marketing of Jamaican sugar destined for export to the preferential quota markets in the EU and the USA. They also held the exclusive right to import raw sugar into the island.
