Masa Investments Limited, a Trinidad-based company, has emerged in recent shareholder lists of GraceKennedy Limited (GK) as the 10th-largest shareholder with an investment worth TT$48.91 million or $1.08 billion.

While this investment only represents 1.51 per cent of GK’s 995.18 million issued ordinary shares, it makes Masa Investments the largest Trinidadian shareholder of the food and finance conglomerate which is listed on the Trinidad & Tobago Stock Exchange (TTSE) and Jamaica Stock Exchange (JSE).

GK’s largest shareholder is NCB Insurance Agency and Fund Managers A/C WT109 with 50,362,365 ordinary shares or a 5.06 per cent stake, down from the 54,412,956 shares at the start of 2023. Other shake-ups in the top 10 include Sagicor Pooled Equity Fund selling 3.35 million shares in the first six months, while Resource in Motion Limited, a business controlled by Donovan Lewis, increased its position by an additional 6.07 million shares to 39,746,031 shares or 3.99 per cent worth $2.87 billion.

Masa is the second largest shareholder in the TT$17.76-billion ($407.51-billion) Trinidadian conglomerate Ansa McAl Limited with a 5.94 per cent stake. Masa is also a shareholder in the Ansa Group, parent company of Ansa Investments Limited, which controls 48.46 per cent of Ansa McAl.

Ansa McAl is a Trinidadian-conglomerate involved in automotive, beverage, construction, distribution, financial services, manufacturing, media, logistics, real estate and renewable energy sectors. It owns a controlling stake in Guardian Media Limited and Ansa Merchant Bank Limited which are both listed on the TTSE and a controlling stake in Berger Paints Jamaica Limited which is also listed on the JSE. Masa Investments, through its majority shareholders, chairs the board, has two deputy chairmen and has numerous executives in the group which includes the chief executive officer.

GraceKennedy had a record first half-year as its consolidated revenue climbed eight per cent to $78.23 billion with its consolidated net profit coming in 13 per cent higher at $4.48 billion. Net profit attributable to shareholders was $4.19 billion with earnings per share (EPS) at $4.22. GK’s total assets are up six per cent to $207.87 billion with total liabilities and equity attributable to shareholders at $126.83 billion and $76.41 billion, respectively.

GK has been on a very significant merger and acquisition strategy over the past several years with Group Chief Executive Officer Donald Wehby Jr noting that its investment bank BroadSpan Capital out of Florida was able to identify 50 potential acquisitions which was narrowed down to 20 potential deals across the region. GK has since announced an acquisition to acquire contract manufacturer Unibev Limited while completing earlier announced acquisitions earlier this year.

This forms part of GK’s strategy to grow its food business which it eventually hopes to list on international markets. GK eventually aims to earn 70 per cent of its revenues and profits outside of Jamaica by 2030.

“What I found very interesting speaking to the investment bankers also is that they’re saying to us that ethnic food is a big thing now and investors will find that very, very attractive. In fact, they referred to our Hispanic brand La Fe in the USA as a big plus as part of our portfolio. One of the strategic reasons behind splitting the company is that it is going to be a more simplified company and it’s going to add a lot of value to the shareholders. That is the consensus by all of the top investment bankers coming out of New York,” said Wehby at a prior briefing.

Wehby increased his direct stake in GK during the first six months by 736,929 shares to 11,570,799 shares valued at $834.14 million.

GK’s stock price closed Thursday at $72.09/TT$3.26, which leaves the stock down double digits on both markets with a market capitalisation of $71.74 billion. GK’s stock hit a new 52-week low of $70 on Wednesday which is a far cry from its peak price of $115 in April 2022.

GK’s trailing 12-month EPS is $7.61 which means that its price to earnings ratio of 9.48 times. GK’s book value of $76.78 gives it a price to book value of 0.94 times. GK’s share buy-back programme is still pending approvals from Trinidadian regulators.

The substantial investment in GK by Masa represents further synchronicity between the two English-speaking Caribbean territories as several multi-billion-dollar deals, including mergers and acquisitions, continue to be executed over the last decade. The most recent business activity was the acquisition of Health Brands Limited (formerly Medi-Grace) by Agostini’s Limited last month which was financed by Bank of Nova Scotia’s Jamaican business. The cost of this acquisition is to be revealed later this year.

Seprod Limited acquired 60 per cent of AS Bryden & Sons Holdings Limited in June 2022 for a deal worth $7.11 billion (TT$310.02 million /US$45.92 million) which propelled its balance sheet from $45.79 billion to $$94.50 billion by the end of 2022. Along with the acquisition of Micon Marketing Limited by AS Bryden, Seprod’s revenue jumped 71 per cent to $78.43 billion with consolidated net profit from continuing operations rising 45 per cent to $3.10 billion. Seprod is also seeking to increase its authorised share capital by 220 million shares at its upcoming annual general meeting (AGM) which could be a precursor to raising new capital to invest across the region.

Even NCB Financial Group Limited (NBCFG) acquired 29.99 per cent of Trinidadian-based Guardian Holdings Limited (GHL) for US$225.33 million in May 2016 before taking an additional 31.98 per cent in May 2019 for US$196.71 million. Although NCBFG only owns 61.77 per cent of GHL now, the business has grown from $107.06 billion in revenue in 2017 to $208.58 billion by 2022. Net profits also moved from $7.71 billion to $31.75 billion over the same time frame, with $1.45 billion in dividends received in 2022 from GHL. GHL derives most of its net earnings from its Jamaican operations which stem from Guardian Life Limited, a business formed after GHL acquired three failed insurance company portfolios following the 1990s financial crisis.