PANJAM Investments has acquired a 15 per cent stake in International CX Limited as it increases its exposure to the business process outsourcing (BPO) sector and ramps up its private equity ambitions in the midst of another crisis.

PanJam is an investment holding company which includes income earned from management fees related to its subsidiaries, interest income and dividends from its associates and proprietary investment portfolio. This includes owning the Scotiabank Centre, Manor Park Plazas and the CIBC FirstCaribbean Building (New Kingston) along with owning associate stakes in Sagicor Group Jamaica Limited (SJ), New Castle Company Limited and Chukka Caribbean Adventures Limited.

PanJam did its first BPO investment in St Lucian IBC (International Business Company) Outsourcing Management Limited (trades as Itel) in November 2019 for a 15 per cent stake valued at $606.31 million. The stake is now valued at $565.69 million to the group due to the $126.84 million share of reserve reduction at acquisition. Itel’s revenue accelerated by 48 per cent from $6.78 billion to $10.05 billion in 2021 as it expanded across the region, but its net profit grew at only 27 per cent to $275.94 million. Itel’s total asset base doubled to $9.55 billion which was supported by a 153 per cent rise in total liabilities to $8.57 billion.

PanJam entered into a contractual arrangement to acquire its stake in the start-up which was incorporated on December 6, 2021 in St Lucia as an IBC with number 2021-00227. The value of the acquisition wasn’t mentioned in the company’s 2021 audited financials, while newly installed PanJam Chief Executive Officer Joanna Banks only noted that if the company requires capital in the future, the shareholders will provide the same.

The investment company also disposed of $30.66 million worth of SJ shares which Banks said was part of capital deployment to growth projects. PanJam had disposed of $2.57 billion of its SJ ownership in its 2019 financial year which propelled its net profit attributable to shareholders to a record $8.31 billion. PanJam’s 30.21 per cent stake contributed $5.22 billion to its $5.46 billion share of profit from its associates in 2021.

PanJam also disposed of its stake in the Downing Street Realty Fund II offered by the Downing Street Group in Canada for $202.09 million while acquiring Funds XIV and XV for $178.74 million.

Though Banks didn’t elaborate further on the company’s private equity and investment plans, PanJam has been a great beneficiary of economic crises as seen with its investments in Mavis Bank Coffee Factory and New Castle. PanJam bought Mavis Bank through its joint venture for $56.03 million in October 2011 and made a gain of $665.63 million in November 2016. New Castle was acquired for $177.52 million, a 25 per cent stake when the company produced $673.14 million in revenue and had $787.70 million in total assets. New Castle earned $2.77 billion in revenue for 2021 and had $796.19 million with PanJam’s stake valued at $829.29 million which includes a $65.69 million dividend.

Banks inherited a $64.35 billion balance sheet on July 1 from Stephen Facey, who served as CEO for 17 years and took over in 2004 with a $9.03 billion asset base. She joined PanJam in September 2016.

“Strategic equity is a key pillar of PanJam’s business model. We are always looking for investment opportunities and will execute if the relevant deals meet our investment criteria. In general, our local investment portfolio is comprised of holdings in well-managed companies across industries that will support and grow the Jamaican economy. The reduction of financial assets at amortised cost represented the sale of assets, the proceeds of which were used to support investments throughout the business. PanJam’s treasury management team continuously evaluates prevailing market conditions and our cash needs. Should it be financially beneficial for us to refinance our August 2022 debt ahead of schedule, we will do so,” Banks added.

PanJam’s revenue rebounded by 109 per cent to $4.30 billion as its investment portfolio generated $2.06 billion compared to the $512.27 million loss influenced by unrealised losses in 2020. Overall net profit attributable to shareholders grew by 106 per cent to $7.20 billion.

The company will be making the 42 residences split as six penthouses and 36 apartments at its Rok Residences downtown available for sale in the coming weeks. It will also be developing two acres of undeveloped land in Norbrook for late 2022 once it finalises the designs of the property. PanJam’s rental income grew by 2 per cent to $1.84 billion for 2021.

“While we cannot predict the end of the pandemic, we are cautiously optimistic about the near-term performance of the tourism and hospitality sectors. Our investments in the Courtyard by Marriott Kingston and Chukka Caribbean are well-positioned to take advantage of any economic recovery that may come,” Banks added on its hospitality investments which had a combined loss of $206.62 million.

Total assets rose by eight per cent to $67.77 billion which is largely compromised of its investment in associated companies valued at $38 billion. Total liabilities grew by three per cent to $15.48 billion while equity attributable to shareholders closed at $51.96 billion.

Apart from its stock price increasing by seven per cent to $68.88 with a market capitalisation of $73.44 billion, PanJam will be rewarding shareholders with a second special dividend on April 29. This payment totals $373.16 million and will be paid to shareholders on record as of April 14 while an interim dividend of $0.285 will be paid on March 31 to shareholders on record as of March 16. This payment totals $303.86 million and is 171 per cent higher than the $0.105 paid last year.