SSL Ventures locks down last active business - But will remain a listed company
Published:Wednesday | February 17, 2021 | 4:51 AMKarena Bennett/Business Reporter
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Bar Central Limited has fallen victim to the market downturn in the entertainment and hospitality sectors. Majority owner SSL Venture Capital Jamaica, which trades as SSL Ventures, made the call to lock down the business effective December 31,...
Bar Central Limited has fallen victim to the market downturn in the entertainment and hospitality sectors.
Majority owner SSL Venture Capital Jamaica, which trades as SSL Ventures, made the call to lock down the business effective December 31, leaving 12 persons without jobs, but is only just disclosing the move in its newly released financial report.
The closure comes one year after founder Kevin Frith stepped down as CEO of the business, which ran for around six years since its 2013 start. SSL Ventures put Nicholas McDavid and Nigel Bair in charge. They were expected to create a post-pandemic strategy for the company which was already suffering from yearly losses.
“We had new management going into to look at the business and to see how we could pivot. It worked for a while, but they were still up against challenges from COVID-19 restrictions which resulted in the closure of a lot of amusements and bars,” SSL Ventures CEO Anthony Dunn said on Monday.
“At the end of the day, we had to decide whether to pump good money after that or just exit the business and redirect our resources to more feasible businesses,” he said.
SSL Ventures is looking for a buyer of Bar Central’s assets, amid plans to wind up the operations. The shutdown has left some 12 individuals without a job.
Bar Central has also “amicably separated” from two of its known large clients, conglomerate GraceKennedy with which the company had a two-year renewable contract for distribution of Tropical Rhythms, Grace Vienna Sausages, Lucozade, and 876 Water to small operators; and rum maker J. Wray & Nephew Limited for which Bar Central had an exclusive distribution deal.
“It is our intention that should we take any decision around winding up the company, we would ensure that minority shareholders are made whole on their investment. That means our decision will not have any negative impact on the minority shareholders because the company would basically repurchase their shares,” Dunn said.
Bar Central was the last of three marketing ventures acquired by SSL Ventures in 2018. One of them, Muse 360 Integrated, was also mothballed after the resignation of its now deceased founder, Andre Burnett. SSL Ventures’ shareholdings in the other company, Bluedot Data Intelligence Limited, was reacquired by founder and CEO Larren Peart in April 2020.
SSL Ventures, which was created in 2018 after a reverse takeover of failed music publishing start-up, C2W Music Limited, held a 75 per cent stake in Bar Central, 51 per cent in Muse360, and a 50 per cent stake in Bluedot Data. Muse360 remains on the venture capital firm’s books as an inactive business.
SSL Ventures is itself majority-owned by Stocks & Securities Limited Jamaica, which in turn is part of the SSL Group.
SSL Ventures, which trades on the junior stock market under the symbol SSLVC, has no active companies in its portfolio currently, but Dunn told the Financial Gleaner that the group has no plans to delist the company.
“There’s benefit to having a listed company and we have several other businesses within the group. It’s for the board and the majority shareholder to decide, but we feel there’s value to keeping the listed entity. What it will become down the road we are not sure yet,” he said.
“As it relates to continuing investment in the venture capital space, that’s not something we are looking at right now but it’s still early days,” he added.
More immediately SSL Group is looking towards private equity deals as the path to growth. Last year, SSL Group CEO Zachary Harding and SSL founder and principal owner disclosed their 50:50 partnership in a private equity outfit called Delta Capital Partners Limited, which trades as DeltaCap.
Through that operation, the group is looking towards larger deals than the venture capital space facilitates.
“With Delta now a part of the group, and from the new pipeline, we have been seeing much larger and more fitted companies for private equities,” Dunn said.
Through SSLVC, the group backed start-ups with equity injections ranging between US$250,000 and US$1 million. However, DeltaCap is looking to take anywhere between a five per cent and 51 per cent stake in larger ventures that have better cash flows and the potential to scale up. DeltaCap also plans to be more actively involved in the day-to-day operations of the businesses it invests in.