Microfinance Group Offers to Buy SSL Ventures for $38 Million | Business

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Publicly listed junior SSL Venture Capital Jamaica Limited, SSL Ventures, has received a takeover bid that could see the acquirer purchase 100% of the company’s shares, in a deal expected to close in early April . The transaction offers the prospect of a much-needed cash injection for the SSL Group and will likely end the group’s foray into providing venture capital funding to start-ups.

It emerged over the weekend that the Saint Lucia-registered microfinance group, led by businessman Dino Hines and controlled by the trio of Hines entrepreneurs, Robert Barnes and David Weir, has bid less of ten cents per share for SSL Ventures’ 400 million shares which puts a book value of just under $38 million on the cash-strapped company.

SSL Ventures announced to the market earlier this month total assets of $24.8 million when releasing its first quarter results for the period ending September 30, 2021, or $2.2 million in more than its year-end results as of June 30. quarter was reported at $3.2 million. With no active operating company in the portfolio for the reporting period, SSL Ventures had no revenue for the quarter. In the first three months of the previous year, it had revenues of $18.5 million.

The offer of $0.0948 per share or $37.9 million for the company doesn’t seem to give much weight to the $512 million market cap based on SSL Ventures’ $1.28 close after trading on the Jamaica Stock Exchange on Friday, an appreciation of 30 cents on the 98 cents it was trading for before.

Hines told the financial gleaner over the weekend that he will not comment until the process is complete. Microfinance Group started as a cambio about seven years ago, but has since diversified into microcredit, investment services, remittances and real estate services.

SSL Ventures COO Anthony Dunn would only say of the deal that the company received a written offer on January 17. That’s just months after selling its remaining 30% stake in Bluedot Insights, a data intelligence company. Bluedot was the last active company of SSL Ventures, which acquired three start-ups immediately after its restructuring as a venture capital firm following a reverse takeover of failing music publishing company C2W Music Limited in 2018.

“SSL will return to its core business which is wealth management and brokerage. The idea of ​​supporting entrepreneurs was good, but it was difficult to bring these companies into the structure of a publicly traded company,” Dunn told the financial gleaner Friday.

His other start-ups were Muse 360 ​​Integrated Limited, a full-service marketing agency and content production company in which SSL Ventures held a 51% stake, and Bar Central, a distribution and strategy company. brand serving the spirits and beverage industries in which it had a 75 percent stake. Muse 360 ​​was closed in August 2019, the assets of Bar Central were sold and the operation was closed in December 2020.

SSL Ventures had been operating as a front company since June 2021.

“We always let the market know that we would consider options that would ensure the preservation of shareholder value. Since we decided to restructure the business and lock in active businesses, our focus then was to ensure that whatever action was taken would benefit shareholders,” Dunn said on Friday.

He did not disclose details of the deal, including the name of the potential new owner of SSL Ventures or the company’s plans going forward, but he estimates the deal could close within the next 90 days.

“We are following the JSE (Jamaica Stock Exchange) takeover rules, so we have to go through all the processes before we can make any further announcements on the details of the offering,” he added.

The company’s management was bullish in its statement on the company’s outlook when its latest financial statements were released to the market on June 7, signaling that fresh cash was on the horizon.

“The board and senior management continue to consider possible solutions to the current difficulties, but if the opportunity arises for a further injection of capital based on the restructured balance sheet, the continued uncertainties of the COVID-19 pandemic 19 remain problematic for potential investors. . In its search for a solution, the Board of Directors continues to keep the interests of shareholders in mind,” management said in its comments on the latest quarterly financial statements of SSL Ventures.

The 2018 reverse takeover of music publisher C2W Music by Stocks & Securities Limited (SSL Jamaica) that gave birth to SSL Ventures was, at the time, intended to be C2W’s shareholder bailout and generator. profits for the SSL Group, but SSL Ventures only entered a profitable position when it began to offload the companies.

SSL Jamaica owned a quarter of the shares of C2W Music before taking over the then-listed music producer, acquiring 80% of C2W’s shares while leaving the remaining 20% ​​in the hands of other investors.

The reverse takeover accelerated then-CEO Drew Gray’s plans to have the vehicle, which was created to invest in start-ups, listed on the Jamaica Stock Exchange.

Gray’s plans were to invest in startups with high growth potential, a move that was to move the publicly traded company from a loss-making position to a profit one.

But in the space of a year, SSL Ventures saw its shares suspended from the Jamaica Stock Exchange twice. The most recent suspension was imposed by the JSE for violating junior market rules.

By June 2019, the investment vehicle had racked up $45 million in losses under then-CEO Mark Croskery.

Croskery then bowed out, allowing Zachary Harding to take the helm after his company, Hyperion Equity Inc, in September 2019 acquired a stake in SSL Growth Equity Limited (Barbados), the parent company of SSL Jamaica.

Harding was appointed Group CEO in charge of SSL Growth Equity, SSL (Jamaica) and SSL Venture Capital Jamaica Limited. He arrived at the helm armed with plans to restructure SSL Group operations to focus on its core wealth management and brokerage businesses while turning around loss-making SSL Ventures.

Until September 2019, subsidiaries of SSL Growth Equity included SSL Asset Management Limited (Cayman); Dolla Financial Services Limited; SSL Capital (Cayman) Limited; SSL REIT Investors Limited (St Lucia) and its Jamaican subsidiary; and SSL (Jamaica) and its subsidiary, SSL Venture Capital Jamaica Limited.

SSL Growth Equity has since sold the shares of SSL REIT to Kingston Wharves Limited and Dolla Financial has been sold to First Rock Capital.

If the takeover of SSL Ventures is successful, the remaining subsidiaries in SSL Growth Equity will be SSL Asset Management Limited (Cayman), SSL Capital (Cayman) Limited and SSL (Jamaica).

As of June 30, 2021, the top 10 shareholders of SSL Ventures were Stocks and Securities Limited (Alpha) with 79%, Kris Astaphan, Drew Gray, Gerald Wight, Sheldon Powe and Mellissa Green-Powe, Croskery Holdings Limited; Nkrumah Wilson, Alanah Jones, Managed Account Stocks and Securities Limited; and Derek Wilkie.

[email protected]@gleanerjm.com

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