PBS Chairman Paul B. Scott (fourth from left) symbolically cuts the ribbon with PBS and other company executives.
PRODUCTIVE Business Solutions Limited (PBS) has completed its acquisition of Xerox del Peru SA and Xerox del Ecuador SA, while also closing on a US$126 million ($19.55 billion) syndicated loan through Citibank, NA.
PBS announced in early April that it would acquire Xerox’s Peruvian and Ecuadorian businesses, subject to secondary approvals. PBS received those approvals, enabling it to complete the acquisition of both businesses by the end of its second quarter on June 30. The acquisitions are expected to add more than $400 million to the group’s consolidated revenues over the next 12 months. In its unaudited fourth-quarter report, PBS reported revenues of $333.33 million ($51.19 billion) for 2023.
“We welcome our Peruvian and Ecuadorian colleagues to PBS. They will join PBS’s team of more than 3,000 technology professionals working to connect the world’s leading enterprise technology companies with governments and leading companies in the Caribbean, Central and South America,” said PBS CEO Pedro Paris Colanado.
Xerox Holdings Corporation will continue to work with PBS on partner-led solutions as Xerox continues to evolve its business model. PBS is currently Xerox’s largest distributor in the Western Hemisphere.
The acquisition marks PBS’ second major acquisition in a year, following its purchase of Curacao-based Infotrans Group Holding BV in June 2023. However, the purchase price has not yet been disclosed as PBS’s audited financial statements have not been made public to date. The transaction is more than three months past the prescribed deadline on the Jamaica Stock Exchange (JSE). As a result, the JSE suspended trading in all PBS shares on July 2 until the audited financial statements are filed. The company is expected to file its audited financial statements by the end of this month, around the same time that Xerox is expected to release its second quarter report, which will include details of the sale to PBS. The company is facing cumulative penalties of $480,000 for the 96-day delay in filing its financial statements.
“PBS is the preeminent enterprise technology platform in the Caribbean and Central America. We are at the forefront of digital transformation and technology investments across our markets. As a result, we are fortunate to have a strong pipeline of opportunities up front to leverage the additional capital we received. PBS is honored to have the support of leading banking partners within the region and beyond, many of whom are also our clients,” PBS Chairman Paul B. Scott said in the release.
The company’s consolidated debt balance as of the end of December 2023 was $144.24 million, of which $47.56 million was due now or within the next 12 months, according to PBS’s fourth-quarter report. The balance also includes $2.58 billion ($16.65 million) related to publicly listed cumulative redeemable preferred shares maturing on July 31 at $100.
The syndicated loan was closed on June 26th through Citibank, the fourth largest bank in the United States, with participation from banking groups in Latin America and Trinidad and Tobago. The loan proceeds will be used to repay existing debt, extend debt maturities (e.g. to 2025 and 2026), strengthen the liquidity profile, and continue to invest in organic growth opportunities. The move further aligns the capital base of the various PBS subsidiaries operating in 22 markets in the region. PBS has also commenced the redemption process of its Jamaican dollar (JMD) preferred shares from June 28th.
“This transaction symbolizes the confidence that a leading global bank has in PBS. It also represents PBS’s international profile and ability to raise capital internationally at a time of illiquidity in the Jamaican market,” PBS said in a statement.
While the Jamaica Financial Services Commission (FSC) has not released regulatory data on the securities industry for over a year, there have been notable changes in capital market refinancing and management of debt maturities coming up in 2024. JMMB Group Limited (JMMBGL) has agreed new terms with preferred shareholders at a general meeting, extending the maturity dates of two preferred shares from January 2024 to January 2030, giving it a preferred shareholding of $8.41 billion. JMMBGL also has $10.36 billion spread across four preferred shares maturing in March 2025.
Mayberry Jamaican Equities Limited recently raised $3.38 billion in a public offering through the JSE bond market, of which $2.2 billion was used to partially repay a margin loan to Mayberry Investments Limited (MIL). Mayberry Investments is scheduled to repay $1.374 billion to Tranche II bondholders on July 19 and $2.282 billion to Tranche III bondholders in January 2025.
NCB Financial Group Limited (NCBFG), an independent holding company, has $36.84 billion in debt maturing between October 2023 and September 2024. The company has refinanced some of its debt through new bond issuances, but a recent additional public offering (APO) only raised $2.5 billion of the original target of $5.097 billion. NCBFG is currently planning to sell NCB (Cayman) Limited and a 30.20% stake in Bermuda-based Clarien Group Limited.
Tropical Battery Company Limited plans to approach the capital markets with a secondary share offering to reduce its current debt pile of $1.72 billion from its recent acquisition of Rose Electronics Distributing Company LLC (Rose Batteries). Other notable publicly-stated debt maturities include First Rock Real Estate Investments Limited’s $13.54 million debt maturing in 2024, Fund Bay Equity Holdings Limited’s 8.50 percent notes maturing this year, and Portland (Barbados) Limited’s multi-million dollar debt maturing in August 2024.
