Lavern Clarke, Business Editor
Ansa McAl corporate headquarters in Port-of-Spain, as seen on the company's website.
Trinidad's AMCL Holdings Limited, a wholly owned subsidiary and affiliate of Ansa McAl Limited, has made its formal offer for all of Barbados Shipping and Trading's shares, but said the bid was conditional on its acquiring at least 50.1 per cent of the conglomerate.
BS&T's 3,000 shareholders have a month, until August 21, to accept the US$3.50 (B$7) per share from the Trinidad company, whose bid rivals the merger deal that Neal & Massy Holdings Limited had hoped to close with BS&T last month.
Under those terms, the deal would be worth anywhere between US$132 million and US$263.5 million, depending on the level of acceptance.
To finance the purchase, Ansa McAl - whose net cash position at the end of its financial year to December 31 was TT$765 million - will subscribe to 265 million common shares in the capital of AMCL, paying US$265 million for the shares.
"In connection with its acquisition of the common shares of the offeror, ANSA McAl has entered a syndicated financing arrangement with ANSA Merchant Bank Limited ... an affiliate of the offeror, for funding in the initial amount of US$265 million, in the aggregate," said the offer circular.
ANSA Merchant Bank is itself a shareholder of AMCL Holdings, with 80,000 shares, while parent ANSA McAl is not.
Neal & Massy, which currently owns 23 per cent of BS&T, or more than 17 million shares, said Monday on the day the rival offer was made public that it would not be wooed by the cash bid, according to a CMC report.
"Neal & Massy assures that the company will not sell any of its shares in BS&T to bidding parties," said Chief Executive Officer Bernard Dulal-Whiteway.
The Trinidadian conglomerate, which is chaired by Arthur Lok Jack, also said it would press ahead with the merger talks.
AMCL said its offer was conditional on its receiving no less than 50.1 per cent of the issued and outstanding shares or 37,718,684 of BS&T's ordinary shares which number just under 75.3 million.
When the company first announced it would bid for the Barbados conglomerate at B$7, the stock on the Barbados Stock Exchange was trading at B$5.51.
Since then, the stock has climbed to B$7.32 on the back of the rivalry, before its suspension on both the Barbados and Trinidad exchanges on July 9.
Ansa McAl said it finalised its offer document July 12, but the company has not improved the B$7 offer whose attractiveness would have been slightly diluted by the stocks market performance.
Under the merger deal being negotiated, shareholders of BS&T would get B$2.76 (US$1.38) per share, with Neal & Massy offering one share in the with the Trinidad company offering one share in the merged company for every 2.75 BS&T shares.
Ansa McAl's counter offer of B$7 was first made June 22. It reiterated plans to bid formally on July 6, adding a new twist.
"Ancillary to this offer, will be an option granted to shareholders to utilise a portion of their cash consideration to purchase shares in ANSA McAl Limited in accordance with the terms and subject to the formula to be detailed in the offer document."
A Barbados based consortium led by Islands Property Limited has also offered B$7.50 per share, but the bid is limited to one million of BS&T's 75.3 million shares.
The latter bid is not expected to gain currency.
BS&T's shareholders were expected to endorse the Neal and Massy deal on June 27, but a surprise injunction acquired by shareholders who wanted more time to study the bids, forced cancellation of the vote.
"Though the process has been delayed, Neal & Massy views the merger as optimally beneficial for shareholders of both companies and will continue in its efforts, together with BS&T, to achieve a successful amalgamation of both companies," said Dulal-Whiteway.
The conglomerate's holdings - which extends to a subsidiary operation in Jamaica - are spread across distribution and logistics, telecommunications, energy and industrial gases, financial services, and automotives.
BS&T also has interests in financial services as well as furniture, hardware, agro-products, food, shipping and other services.
Magna Rewards is listed among its financial subsidiaries, which includes the operation here, Magna Jamaica Limited.
The merger of the two conglomerates was initially announced in May.
If successful - a two-thirds majority of BS&T shareholders must vote in favour — it will create the largest conglomerate in the region, with combined revenues of US$1 billion, employing some 9,000 people and having 10,000 shareholders.
Thenewly formed company would be registered and headquartered in Port-of-Spain and would continue to trade shares on both the Trinidad and Tobago and the Barbados Stock Exchanges.
lavern.clarke@gleanerjm.com
