THE Financial Sector Adjustment Company (FINSAC) will pump $2b into Life of Jamaica (LoJ) as part of a deal struck late Wednesday night that will see executive chairman Dennis Lalor give up that role but remain a director of the company.
As well as changes to the current share ownership structure of the company, which will see FINSAC take 76 per cent of the company, a rights issue for as much as $800 million could also be forthcoming. This would be subscribed to by FINSAC and large investors such as Mr. Lalor and LoJ founder Danny Williams.
LoJ's board of directors led by current executive chairman Mr. Lalor are set to back a deal that will see investors called to an extraordinary general meeting in the next few weeks to discuss and vote on the plans.
Mr. Lalor was out of office yesterday but industry sources said a showdown meeting on Wednesday night had led to an agreement. Business consultant Oliver Holmes was among a team of three LoJ representatives that negotiated with the FINSAC team led by Maxine MacClure.
The heated meeting led to a showdown at one point, where threats were made on both sides to "lock down" LoJ, according to FINSAC insiders.
As has been reported for several months FINSAC will take a 76 per cent stake in the life company. Its life insurance consultant Kurtis Bray is expected to become a director of the company and could among a number of changes take an executive role at the company.
But moves to oust both Mr. Lalor and LoJ president Milverton Reynolds appear to have failed. Both will remain at the company despite efforts up to two weeks ago to replace either one or both men.
Under the plan, which is similar in form to one recently put forward by NCB Group, FINSAC will convert its preference shares into ordinary shares and agree to increase its stake in the company. FINSAC's current 26.5 per cent stake will rise to 76 per cent, with private shareholders such as Mr. Lalor, whose stake will fall from 37 to 12 per cent, will control the remaining 24 per cent.
