Hendrickson makes offer for minority shares in Pegasus
Published:Friday | December 31, 2010 | 12:00 AM
Kevin HendRickson, through his company, Quivin Holdings Limited, has made an offer to minority shareholders in Pegasus Hotels of Jamaica Limited to buy up all outstanding shares, as mandated by stock exchange rules.
Quivin acquired 59.81 per cent of Pegasus, amounting to 71.865 million ordinary shares for US$11 million (J$947.639m), in Septem-ber from ultimate parent Urban Development Corporation (UDC).
It is offering to buy the remaining 48.3 million units, or 40.195 per cent of the company, whose sole asset is The Jamaica Pegasus hotel, at J$13.14 per share, which values the minority offer at J$634.67 million.
The offer puts 9.4 per cent premium on the stock's last trading price of J$12.01.
Shareholders have three weeks in which to subscribe to Hendrickson's offer, which opens January 19 and closes February 10.
KPMG Regulatory and Com-pliance Services will act as registrar, and acceptance forms - along with share certificates - may be returned to KPMG or to any Jamaica Money Market Brokers Limited branch nationwide, Hendrickson said in a stock market filing Tuesday.
Hendrickson's J$13.14 offer values the company at J$1.58 billion on the stock market. Its net asset value, however, is three times that at J$5.72 billion, of which J$5.7 billion is fixed assets related to the hotel property.
Two months into the acquisition, the board had a makeover, dropping Chairman Desmond Young and directors Daniella Gentles Silvera, Dahlia Kelly, Robert Russell, Michael Subratie and UDC General Manager Joy Douglas; and seating Hendrickson, Milton Samuda, Jacqueline Hen-drickson, Eric Stultz, Lance Hylton and Matthew C.H. Lyn.
The Jamaica Pegasus is Kings-ton's top meeting hotel, and its largest with 340 rooms, but the property has not been a reliable profitmaker. At year end March, it made J$17 million in net profit, but its subsequent half-year results show a loss of J$34 million as at September.
Hendrickson also owns and operates the adjacent Courtleigh Hotel, separated from The Jamaica Pegasus by fencing, but he is yet to say whether the two properties will be merged or maintain their current separate identities and marketing programmes.