PRODUCTIVE Business Solutions Limited’s (PBS) perpetual cumulative redeemable preference shares offer closed last Friday at 3:30 pm after being oversubscribed above the initial US$11-million ($1.69-billion) target.

The offer had an initial one million US-dollar (US$) preference shares on offer at US$10 per share, and 150,000 Jamaican-dollar (JMD) preference shares at $1,000. If upsized, there were an additional 500,000 USD preference shares which could have been issued, and 150,000 JMD preference shares as well.

However, an addendum was posted on the Jamaica Stock Exchange on Friday that the JMD preference shares could now be upsized by an additional 350,000 preference shares. This means that US$15 million and $500 million (US$3.31 million) were the new upper bounds for the offer for a combined total of US$18.31 million or $2.77 billion. As a result, this means PBS can issue another 3.5 million USD preference shares and 4.5 million JMD preference shares in a future offer.

The USD preference share rate is fixed at 9.25 per cent while the JMD preference share rate is fixed at 10.50 per cent. The first call option date is set for December 31, 2036 with the option for the preference shares to be subsequently redeemed every three years after. The proceeds will be used to fund the company’s strategic growth objectives which include acquisitions and expansion into new territories. PBS expects to spend $100 – $157.50 million in fees relating to the offer, including to its Barbadian listing sponsor ListAssist Services (Barbados) Ltd. The Musson Group and Facey Group Limited collectively own 69.80 per cent of PBS.

“We are extremely pleased with the oversubscribed issuance and it clearly shows the confidence and trust that the market has in PBS. As the largest enterprise technology company in the region, we can’t wait to initiate our strategic growth objectives with our investors,” said PBS Chief executive officer Pedro Paris in response to the success of the offer.

The basis of allotment and allocations should be announced within seven days after the offer closes, which is September 16. Refunds should be credited back to applicants’ accounts within 10 days after the offer closes, which is September 19. PBS intends to list the preference shares on the JSE’s Main and USD markets, and to do a secondary listing of the preference shares on the Barbados Stock Exchange (BSE). These would be the 147th and 148th securities listed on the overall market.

For the six-month period, January to June, PBS’s revenue grew 53 per cent to US$157.59 million, with operating profit climbing from US$3.97 million to US$12.71 million. EBITDA stood at US$21.66 million for the half-year, with finance costs coming in at US$8.15 million. Net profit attributable to shareholders stood at US$2.32 million relative to the US$294,000 loss in the same period.

PBS’s stock price is up 20 per cent, year to date, to US$1.3225, which leaves it with a market capitalisation of US$246.27 million. Its 9.75 per cent JMD preference share is up 44 per cent year to date to $150 despite its par value being $100 and being redeemable in July 2024.

PBS is an enterprise technology firm with more than 2,200 employees. It operates in 19 countries with its regional headquarters in Guatemala, and represents more than 100 global technology brands such as Apple, Dell, Google and Microsoft. JMMB Securities Limited was the lead broker with Barita Investments Limited being the selling agent. NCB Capital Markets Limited recommended its clients participate in the offer.

— David Rose