National Road Operating and Constructing Company Limited (“NROCC”), has put up for sale 8 billion shares or a 64 per cent ownership Transjamaican Highway Limited aimed at raising $11.2 billion.
The offer, which was uploaded on the Jamaica Stock Exchange earlier today, doubles that of Wigton Windfarm, in which the Government of Jamaica raised $5.5 billion from the sale of 11 billion shares last April.
The highly-anticipated initial public offering for Transjamaican Highway will run from February 17 to March 9, 2020, at a price of $1.41 or US$0.01 per share.
Up to 5,362,962,963 Shares in the Offer for Sale will be reserved for employees, eTag customers for Highway 2000 EastWest leg on record as at February 14, 2020, public sector employees, underwriters and registered Pension Funds.
NROCC also reserves the right to upsize the offer by an additional 2,000,000,000 shares. NROCC currently owns 100 per cent of the shares in Transjamaican Highway.
“NROCC understands that it is the intention of the company to apply to the JSE to list the whole of the issued ordinary share capital of the Company inclusive of the Shares included in this Prospectus on the US$ Main Market of the JSE with a cross-listing on the J$ Main Market of the JSE,” the prospectus read.
The proceeds from the share offer will partly be used to redeem the equity bridge notes which were used to purchase the ordinary shares in Transjamaican from the previous shareholders.
Previously, Transjamaican Highway was owned jointly by Bouygues Travaux Publics, Vinci Construction, IFC, and Proparco. NROCC in conjunction with the Ministry of Finance and the Public Service will decide on how the balance is to be utilized.
“The company is projecting dividends yield (based on the offer price) ranging from an average of 5.3 per cent to 8.7 per cent in 2020-2025; an average of 24.5 per cent to 35.8 per cent thereafter. Overall average of 18.8 per cent to 27.8 per cent for the total period of 2020-2036,” the prospectus said.
Transjamaican Highway, which is in the business of developing, operating, and maintaining the Highway 2000 East-West toll roads. Highway 2000 East-West is a 49.9km tolled motorway with two distinct corridors: T1 – 43.45km between Kingston and May Pen, and T2 – 6.5km between Portmore and Kingston.
The company, as concessionaire, operates the Highway 2000 East-West under concession agreement dated 21 November 2001 (amended and restated 28 January 2011) and on 29 January 2020, granted by NROCC the concession Agreement. The concession is for a period of 35 years, with 17 years remaining to expiry.
Highway 2000 East-West was the first toll road to be built and operated in Jamaica and was transformative in shortening the commute between Kingston and May Pen and Kingston and Portmore.
The Government of Jamaica, through NROCC, a state-owned entity, purchased 100 per cent of the ordinary shares in Transjamaican on 23 December 2019.
While the ownership of Transjamaican has changed hands, there will be continuity in the operations and management of the toll road by Jamaican Infrastructure Operators, a company jointly owned by Bouygues and Vinci which combined has over 50 years of experience internationally and regionally in managing toll roads.