by Marlon Madden
The Jamaica-based GraceKennedy Group, one of the Caribbean’s largest conglomerates, is eyeing further expansion into the Barbados market as it seeks to grow the financial services’ money services segments of its operations.
The company, which currently owns 50 per cent of the SigniaGlobe Financial Group, is said to be exploring a number of mergers and acquisitions this year. Speaking on the plans during the company’s recent investor briefing, Group chief executive officer Senator Don Wehby said “we have about 11 companies in the pipeline and a lot of them are financial services”.
“We are looking at companies in the Eastern Caribbean primarily. Insurance is a big segment that we have a few looking at, and money services, and one of them is actually in Barbados in terms of money services. So on the finance side, we are primarily focusing on the Eastern Caribbean to do more acquisitions in insurance and money services,” he disclosed.
He reported that the company was already “working through a few” of the planned acquisitions, with them being at varying stages, and that once all due diligence was concluded an announcement would be made. Speaking specifically about the Barbados market, Wehby said the company was looking “very seriously” at increasing its investment in that market.
He said he believed the island’s corporate tax rate of between one and five per cent will serve as a major attraction for more regional business to invest in the jurisdiction.
“Your Prime Minister Mia Mottley made a brave move and I thought it was actually innovative for her in terms of the corporate tax rate where it is now, and I think that in itself is going to attract a lot of other Caribbean companies to invest in Barbados. It is very, very attractive and we are looking at acquisitions in Barbados,” he said.
Looking back at the decision to delist from the Barbados Stock Exchange (BSE) several years ago, Wehby, who reported two years ago that he was looking at the possibility of listing SigniaGlobe on the BSE, said the delisting of GraceKennedy had nothing to do with Barbados or the economy but “more has to do with the [low] liquidity”.
Wehby, who has been pleading for the single regional stock exchange to become a reality to help increase capitalsation of all listed companies across the Caribbean, said “what we found in Barbados was that the liquidity was very low and it really did not make sense at the time to continue to list, but the fundamental problem we have in the Caribbean is that markets are too fragmented”.
“I believe the way to go is to have one stock exchange – the Caribbean stock exchange, where all companies are listed on the exchange – and I believe you are going to attract new investment, new companies to the exchange because you are going to have a deeper market and the liquidity will be there,” he explained.
GraceKennedy is in the process of finalising its 2030 vision, and a part of that will be to list the food division on an overseas stock exchange. Wehby said the decision has not yet been finalised.
The company, which has operations in money services, retail and distribution, manufacturing, insurance, banking and investment, ended the year 2021 with a “good” performance and improved operational efficiency and investment in manufacturing optimisation and modernisation.
Wehby also boasted of being able to grow market share in all business segments, execute on digital transformation, pursue mergers and acquisitions, attract, retain and develop talent at all levels, increase corporate social responsibility and maintain good working capital management and preserve cash.
Last year, the company recorded revenue of 12 per cent increase, to reach JA$129.3 billion (about US$8.5 million), up from the JA$115.4 billion in 2020 and JA$103.1 billion the prior year. Profit before tax for last year was 20.3 per cent or JA$2 billion. Profit after tax was JA$2.1 billion. The company also won a number of awards last year.